Beige Book: Economic Activity Expanding at a Moderate Pace

Economic activity expanded at a moderate pace across the twelve Federal Reserve Districts in late July through August, according to the just-released Federal Reserve Beige Book. The report was based on information collected through August 31.

The economic expansion over the period was driven in part by a continued growth of consumer spending at a modest pace. Manufacturing activity grew at a moderate pace in most Districts, but business contacts continued to express concern about tariffs and trade tensions. Home construction activity was mixed, while home sales softened. Agricultural conditions weakened in some Districts. Businesses generally remained optimistic about the near-term outlook.

Employment growth was modest to moderate on balance in most Districts. Labor markets once again remained tight, with most Districts reporting widespread shortages in both high-skill and low-skill workers. Businesses responded in a variety of ways, including increasingly using benefits to attract and retain workers and putting more resources into training.

Modest to moderate wage growth was seen in most Districts as upward wage pressures continue to persist. Prices increased at a modest to moderate pace across most Districts, though there were some signs of deceleration. Contacts reported widespread input price pressures, particularly for construction materials and freight transportation, in part due to tariffs.

Read the full Federal Reserve report.