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Below are the key highlights from the Federal Reserve’s closely watched Beige Book, via Reuters.

  • U.S. Economy continued to expand in recent weeks.
  • 10 of 12 districts reported ‘moderate or modest growth;’ Dallas district reported ‘strong growth’ helped by energy; st. Louis district called growth ‘slight’.
  • Manufacturers in all districts expressed concern about tariffs; many reported higher prices and supply disruptions they attributed to new trade policies.
  • Prices increased in all districts at ‘modest to moderate’ pace; pricing pressures are expected to ‘intensify further’ in some districts.
  • Prices of key inputs rose further, including fuel, construction materials, freight and metals; tariffs contributed to increases for metals, lumber.
  • A few districts described input price pressures as ‘elevated or strong’.
  • Pass-through from input to consumer prices remained ‘slight to moderate’.
  • All districts reported labor markets were tight; many said inability to find workers constrained growth.
  • On balance wage increases were ‘modest to moderate’.
  • Consumer spending was up in all districts with particular strength in Dallas, Richmond.
  • Several districts reported slow growth in existing home sales but were not ‘overly concerned’ about rising interest rates.