Consumers delivered some seasonal relief over the holidays by meeting expectations in most districts and by exceeding expectations in three districts, including in New York, which noted strong holiday spending on apparel, toys and sporting goods.

Little or no change in economic activity was reported in most of the 12 US Federal Reserve districts since the prior Beige Book period.
Of the four that differed, three reported modest growth and one a moderate decline.
Manufacturing activity dropped in nearly all districts.
Most districts indicated their firms expect positive or improved growth or both.

Seasonal demand also lifted airfreight volume from e-commerce in Richmond and credit card lending in Philadelphia.

Contacts from nearly all districts reported decreases in manufacturing activity.

Overall, most districts indicated that expectations of their firms for future growth were positive, had improved, or both.

Seven districts described little or no net change in overall employment levels, while the pace of job growth was described as modest to moderate in four districts. Two districts continued to note a tight labour market. However, nearly all districts cited one or more signs of a cooling labour market.

The pace of wage growth was characterised as moderate in Boston, Richmond, Chicago and Dallas; as modest in New York and Philadelphia; and as slight in St. Louis. Firms from many districts expected wage pressures to ease and wage growth to fall further over the next year.

Six districts noted that their contacts had reported slight or modest price increases, and two noted moderate increases. Five districts also noted that overall price increases had subsided to some degree from the prior period, while three others indicated no significant shift in price pressures.

Firms in most districts cited examples of steady or falling input prices in the manufacturing sector. Districts also noted that increased consumer price sensitivity had forced retailers to narrow their profit margins and to push back in turn on their suppliers’ efforts to raise prices.

The Beige Book is published eight times every year. Each Fed bank gathers anecdotal information on current economic conditions in its district through reports from bank and branch directors and interviews with key business contacts, economists, market experts and other sources.

Fibre2Fashion News Desk (DS)