The Federal Reserve's latest survey of regional economic conditions points to continued growth and a slowdown in price increases, according to a report released Wednesday. The findings come just weeks before the central bank's July policy meeting, where officials will weigh whether to adjust interest rates.
What the Beige Book found
The Beige Book, a compilation of anecdotal information from the Fed's 12 districts, indicated that economic activity expanded at a slight or modest pace in most regions. Several districts reported that inflation was easing, though prices remained elevated in some sectors. Labor markets showed signs of cooling, with some districts noting slower wage growth.
The data will be a key input for the Federal Open Market Committee when it meets July 30-31. The survey's signal of easing inflation could support the case for holding rates steady, while the still-positive growth outlook may keep the Fed cautious about cutting too soon. The Fed has kept its benchmark rate at 5.25%-5.5% since July 2023.
The FOMC will release its rate decision on July 31. Investors will watch for any shift in language regarding the path of inflation and the timing of potential rate cuts. The next Beige Book will be released ahead of the September meeting.
The Fed's next move remains uncertain, but the latest survey gives policymakers a clearer picture of an economy that is still growing but showing signs of cooling price pressures.
