Economy, Inflation Growth Modest, Job Growth Slows: Fed’s Beige Book

Economy, Inflation Growth Modest, Job Growth Slows: Fed’s Beige Book

© Reuters. ©
Reuters.

By
Yasin
Ebrahim

Investing.com

The
economy
grew
at
modest
pace
as
a
growing
number
of
districts
saw
a
decline
in
job
growth
and a
rise
in
inflation
boosted
by
increasing
input
costs,
according
to
the
Fed’s
Beige
Book
released
Wednesday.

The
central
bank’s
Beige
Book
economic
report,
based
on 
anecdotal
information
collected
by
the
Fed’s
12
reserve
banks
through
Jan.
4,
showed
the
U.S.
economy
and
inflation
expanded
at
a
modest
pace,
though
the
pace
of
employment
slowed
in
most
districts.

“Economic
activity
increased
modestly
since
the
previous
Beige
Book
period

and
almost
all
districts
saw
modest
price
increases,”
the
report
said.
While
a
“growing
number
of
districts
reported
a
drop
in
employment
levels
relative
to
the
previous
reporting
period.” 

The
somewhat
gloomier
backdrop
for
the
labor
market
comes
as
the
surge
in
the
virus
continues
to
dent
near-term
business
optimism
despite
the
vaccine
roll
out. 
“Although
the
prospect
of
COVID-19
vaccines
has
bolstered
business
optimism
for
2021
growth,
this
has
been
tempered
by
concern
over
the
recent
virus
resurgence
and
the
implications
for
near-term
business
conditions,”
according
to
the
report. 

Subdued
business
optimism
and
weaker
job
growth
appears
to
be
making
a
dent
in
consumer
spending,
though
online
spending
continues
to
enjoy
healthy
demand. 

“Some
Districts
noted
declines
in
retail
sales
and
demand
for
leisure
and
hospitality
services,
largely
owing
to
the
recent
surge
in
COVID-19
cases
and
stricter
containment
measures
… Most
Districts
reported
an
intensification
of
the
ongoing
shift
from
in-person
shopping
to
online
sales
during
the
holiday
season.


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