Economist's Insights

Beige Book Indicates Continued Economic Growth and Labor Market Tightening

May 31, 2017

The Fed’s May Beige Book indicated the economy continued to grow at a modest to moderate pace across the various 12 Fed Districts, although several Districts reported a slowing of activity since the last report in April. Consumer spending moderated with slower auto sales while most Districts continued to report moderate manufacturing growth and modest to moderate growth in residential construction and sales of existing homes. Consistent with recent readings on small business sentiment, firms reported they remain confident about the near-term but several Districts have seen that confidence ease. Most Districts indicated further tightening in the labor market with modest to moderate growth in both hiring and wages. Pricing pressures remain modest in most Districts but increasing input costs and tight housing inventories were credited with driving prices higher in certain pockets of manufacturing and construction as well as in new home listings.