Federal Reserve Beige Book: Economic activity has increased slightly, showing improvement compared to the previous report
The Federal Reserve's Beige Book shows that from late May to early July, economic activity increased slightly, with five regions experiencing growth, five regions remaining flat, and two regions declining slightly. This represents an improvement compared to the previous report. Although loan volumes increased slightly in most regions, uncertainty remains high, and businesses are cautious. Overall consumer spending declined, auto sales decreased slightly, and the performance of the tourism and manufacturing sectors varied. The outlook is neutral to slightly pessimistic, with only two regions expecting an increase in economic activity
On Wednesday local time, the Federal Reserve's Beige Book showed that economic activity increased slightly from late May to early July. Five districts experienced slight or moderate growth in economic activity, five districts had flat economic activity, and the remaining two districts saw a slight decline in economic activity. This represents an improvement from the previous report, in which half of the districts had at least a slight decline in economic activity.
The Beige Book noted that uncertainty remains high, leading businesses to continue to exercise caution.
Consumer spending on non-auto goods declined in most districts, showing an overall slight weakening. After consumers rushed to purchase vehicles earlier this year to avoid tariffs, auto sales have averaged a slight decline. Tourism activity was mixed, manufacturing activity decreased slightly, and non-financial services activity remained virtually unchanged on average, though there were regional variations.
Loan volumes increased slightly in most districts. Construction activity slowed due to rising costs in some areas. Home sales were flat or showed little change in most districts, and non-residential real estate activity was also generally stable.
Activity in the agricultural sector remains weak. Energy sector activity declined slightly, while transportation sector activity was mixed.
In terms of outlook, the sentiment is neutral to slightly pessimistic, as only two districts expect economic activity to increase, while others anticipate activity to remain flat or slightly weaken.
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