(Tiper Stock Exchange) – Overall economic activity in the United States “increased slightly” in early 2023, as supply chain disruptions continued to ease and consumer spending remained broadly stable, while in many areas of the country high inflation and higher interest rates continued to reduce discretionary income and the power of consumer purchase. The affirms it Federal Reserve In the Beige Bookthe report on the state of the US economy which will form the basis for future monetary policy decisions.
The document collects the anecdotal evidence on the state of the economy from various Federal Reserve Districts across the nation. Information for this report was collected prior to February 27.
Looking at the various sectors, the document highlights that the travel and tourism activity has remained quite strong in most districts, while themanufacturing activity has stabilized after a period of contraction. THE real estate markets they have remained subdued, held back by exceptionally low inventories. Commercial real estate activity was stable, with some growth in the industrial market but continued weakness in the office market.
The job market
The labor market conditions “I am remained solidEmployment continued to increase at a “modest to moderate” pace in most Districts, despite hiring freezes by some companies and scattered reports of layoffs.
There manpower availability improved slightly, although finding workers with the desired skills or experience “remained difficult”. While job markets have generally remained tense, some districts have noticed that companies are becoming less flexible with employees and are starting to reduce remote work options.
Wages have generally increased at a moderate pace, although some districts have noted that wage pressures yes they were “slightly attenuate“. Wage increases are expected to moderate further in the coming year.
Inflation
The inflationary pressures “I am remained widespread“, although in many Districts price increases have moderated. Several Districts have seen a further increase in input costs, particularly for energy and raw materials, while there has been some relief for freight costs and shipments.
Some Districts have noticed that businesses have majors difficulties in passing on the increase in costs to their consumers. Selling prices have “increased moderately” in most Districts, with several Districts experiencing a deceleration.
Looking to the future, it is expected that the price increases will continue to moderate during the year.