The latest Beige Book report, which summarizes the economic conditions in the Fed’s 12 regions, showed that the US economy grew at a moderate pace in the first quarter of 2023, but there were some signs of slowdown compared to previous periods.
What Are the Details in the FED’s Beige Book?
The Richmond FED report, based on information collected on or before April 10, 2023, also showed that inflation pressures had eased somewhat in recent weeks as prices of non-labor inputs and shipping costs fell sharply. However, consumer prices continued to rise moderately due to high demand and rising inventory and labor costs.
Beige Book also revealed that the labor market has become less tight, with some regions reporting an increase in labor supply. Employment growth was somewhat moderate during this period and wages remained high, but moderated to some extent.
Few firms reported mass layoffs, mostly concentrated in some of the largest companies.
The report also stated that loan volumes and loan demand generally decreased in consumer and commercial loan types, while it was noted that interested parties expected to get rid of input cost pressures more, but they expected to change their prices more frequently compared to previous years.
Expectations for future growth also remained mostly unchanged, with the outlook deteriorating in the two Fed regions.
The Beige Book is one of the tools the FED uses to assess the state of the economy and determine monetary policy. The next meeting of the Federal Open Market Committee (FOMC), which decides on interest rates and other policy measures, is scheduled for May 2-3, 2023.
*Not investment advice.
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