WASHINGTON—Almost all of the Federal Reserve's districts reported "some growth” during the most recent period measured, with a few reporting "moderate" gains, according to the Fed's latest Beige Book data.
NAFCU Chief Economist and Vice President of Research Curt Long reiterated the association expects no changes to interest rates this year, even as other analysts believe there will be one or more Fed rate reductions this year, as CUToday.info reported here.
"The Fed's latest Beige Book shows an economy growing slowly but steadily, belying the volatility in financial markets," said Long. "For the most part, the Fed's manufacturing contacts relate that tariffs are causing considerable anxiety, but have yet to make meaningful impact on their businesses. NAFCU expects no Fed action on interest rates this year, with trade policy being the biggest risk to that forecast."
Economic activity expanded at a modest pace overall from April through mid-May, a slight improvement over the previous period.
Also Worth Noting
Also of note in this report, according to Long:
- Reports on manufacturing were "generally positive, but some Districts noted signs of slowing activity and a more uncertain outlook among contacts"
- Reports on consumer spending were "generally positive but tempered"
- Loan demand was "mixed but indicated growth"
- Employment continued to increase nationwide, with most districts reporting modest or moderate growth, and others reporting slight growth
Better Pay, But…
Due to competition for workers, several districts reported that employers made "improvements in benefits to attract more workers and to improve retention of existing employees."
"However, overall wage pressures remained relatively subdued given low unemployment rates; a majority of Districts reported modest or moderate wage growth," the report stated.