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The Beige Book prepared for the 12-13 June FOMC meeting, covering information through 21 May, indicated few material changes in the trajectory of economic growth in most districts, notes the research team at Nomura.

Key Quotes

“The Dallas Fed district reported a notable pickup in growth, while a number of districts reported acceleration in manufacturing and industrial activity. However, the Beige Book noted some softening in consumer activity as “nonauto retail sales growth moderated somewhat and auto sales were flat.” As has been the case for some time now, the Beige Book highlighted some concern about US trade policy from district contacts.”

“The outlook for employment and wage growth was largely unchanged with most districts reporting moderate increases in employment but only modest increases in wages. Despite continued labor shortages, some respondents expect “similar employment and wage gains in the coming months,” indicating that a sustained acceleration in wage growth may not be around the corner. For inflation, it appears input prices continued to rise with greater dispersion across industries. The Beige Book indicated that prices continued to increase at a “moderate” pace overall.”