Federal Reserve Beige Book: Mild to moderate economic growth across the United States, with moderate price increases in most regions
During the coverage period of this Beige Book, overall contacts held an optimistic outlook for the future. Several manufacturers indicated that they are stockpiling inventory in response to expectations of higher tariffs. Overall employment in the United States has increased
On Wednesday, the Federal Reserve stated in its latest Beige Book report that economic activity across the United States grew slightly to moderately from late November to December, thanks to strong holiday season sales.
Although some contacts expressed concerns about the outlook for 2025, particularly regarding the potential impacts of changes in immigration and tariff policies, overall, contacts were optimistic about the future. Several manufacturers reported that they were stockpiling inventory in anticipation of higher tariffs.
During the coverage period of this Beige Book, overall employment in the U.S. increased, with half of the 12 regional Federal Reserves reporting slight increases in hiring, while the other six regions saw no change. Wage growth accelerated in most regions. The Beige Book noted that contacts in several service industries, especially in healthcare, continued to see job growth. However, employment in manufacturing remained stable.
In terms of inflation, prices rose moderately overall. Businesses expect prices to continue rising this year, with some warning that new tariffs could lead to further price increases. The Beige Book indicated that the vast majority of regions reported moderate increases in selling prices, although there were also cases of prices remaining flat or declining, particularly in the retail and manufacturing sectors. The spread of avian influenza has led to a reduction in poultry and egg supply, thereby pushing up food prices.
Additionally, the Beige Book mentioned that vehicle sales grew at a moderate pace. Overall, construction activity declined, with several regional Federal Reserves reporting that high raw material and financing costs were detrimental to growth.
This Beige Book was compiled by the Chicago Federal Reserve using information collected through January 6, and includes anecdotes and comments on business conditions from the 12 Federal Reserve Banks. This information was gathered prior to the recent wildfires in the Los Angeles area