Federal Reserve Report Shows Modest Economic Growth

Date: October 20, 2016

Latest “Beige Book” Survey Shows Moderate Growth Across Majority Of Districts

According to the latest Federal Reserve “Beige Book” survey of economic conditions across the US, most of the 12 districts of the Fed have seen modest economic growth from late August to mid-October. The report showed “growth was modest or moderate in eight districts, slight in three, and flat in the New York district,” the AP reports. The AP characterizes the report as “consistent with most economists’ estimates” and “an improvement from its September survey, which found that growth weakened in two districts and was unchanged in two.” The AP adds that the slight growth was “supported by modest hiring, an uptick in consumer spending, and steady homebuilding, according to the Federal Reserve.” Bloomberg News says the “mostly positive” report showed that most districts “indicated a modest or moderate pace of expansion,” the job market “remained tight,” wage growth “held fairly steady,” and housing expanded in most districts. The report “characterized price growth generally as ‘mild,’ as manufacturers in the Midwest reported lower prices for finished goods and the hospitality industry on the West Coast saw modest price gains.” USA Today reports the economy “expanded at a modest to moderate pace” during the period, “as a pickup in retail sales and housing offset a mixed picture for manufacturing.” However, “job growth was tempered.” The piece says the “Beige Book” was “largely similar to recent editions, but its subdued description of payroll and wage growth seemed to match the official pullback reported by the Labor Department.” Reuters reports the Fed said in the survey, “Wage growth held fairly steady at modest levels, although some districts reported rising pressure for certain sectors.”

What This Means For Small Businesses

The latest “Beige Book” survey suggests more of the same for the US economy – uneven, sporadic growth in some sectors, but signs of continued weakness. Small business owners are looking for more clear indications that the economy is robust in order to alleviate their uncertainty about future business conditions. Unfortunately, there is little in this latest report to help ease this uncertainty.

Additional Reading

MarketWatch and the Wall Street Journal also report on the story.

Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.

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