This report will help support the notion that past rate hikes are now taking affect, and that policymakers should leave interest rates alone at upcoming FOMC meetings. The Beige Book indicates that the economy s growth has throttled back from its torrid pace at the start of the year. It indicates that most regional economies are responding to higher interest rates and are now showing at least some signs of easing. The FOMC will take comfort in this report, which confirms other data releases over the past month that have shown slower retail sales, a slowdown in the pace of hiring, and softer real estate markets. The FOMC is not expected to raise rates again this year, a decision that is supported by the results of this Beige Book release.
Labor markets remain tight, but appear to being easing a bit.
This is the case in 7 of the 12 Districts, which reported slowing economic growth and at least some easing of labor market tightness. The other Districts reported no change in economic growth, with the exception of St. Louis, which reported accelerating growth. Many Districts are still reporting wage increases and the growing use of benefits, however. There are also indications that worker shortages are limiting growth in a few areas. Consumer spending appears to be slowing according to this Beige Book release.