The U.S. economy continued to increase at a “modest to moderate pace” according to today’s release of the Federal Reserve’s latest Beige Book. Employment, one of the key drivers of the Fed’s monetary policy decisions, was stable or increasing slightly although some Fed districts noted a “reluctance” to hire full-time or permanent employees.
Retail activity, including auto sales, was mixed, with 8 of 12 Fed districts reporting an overall increase in consumer spending. Only New York reported softer retail sales, but auto sales were “strong” in five districts, showed either “moderate” or “steady” growth in four more, while only Dallas reported softer sales.
All but one Fed district — Cleveland — reported increases in sales of single-family homes, with rising home sales, home prices, or home construction. Low inventories are pushing prices higher in several districts, but construction activity improved “moderately” in many districts. Commercial real estate markets were also generally positive.
Mining and energy production activity was said to be “stable or increased” across the 12 districts. Minneapolis noted that oil and gas exploration was up slightly, but coal production was down in three districts.
On the jobs front, the Fed said, “Hiring held steady or increased at a measured pace in most Districts,” and wage pressures “remained limited or contained. In general, prices for finished goods were stable or somewhat higher, though price rises increases raw materials prices were noted in Philadelphia and Richmond. New York indicated that input price pressure is down, but that it remains “widespread in services.”
Today’s report comes after several weeks of back-and-forth on the Fed’s asset purchasing program. There’s nothing obviously shocking in this edition of the Beige Book, and that’s probably a good thing.