Washington: The Federal Reserve released a report on Wednesday saying overall US economic activity has expanded slightly since late February.The Fed's Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts, said ten outof twelve districts experienced either slight or modest economic growth.
While the other two districts reported no changes in activity, the number of districts reporting slight or modest economic growth is upfrom eight in the previous report.
In contrast to recent upbeat retail sales data, the Fed said consumerspending has barely increased overall but acknowledged reports werequite mixed across districts and spending categories.
The report said several reports mentioned weakness in discretionaryspending, as consumers' price sensitivity remained elevated.
Expanding on the issue of inflation, the Beige Book said priceincreases were modest, on average, running at about the same pace asin the last report. The Fed said disruptions in the Red Sea and thecollapse of Baltimore's Key Bridge have so far not led to widespreadprice increases, but several districts noted moderate increases inenergy prices and sharp increases in insurance rates.
"Another frequent comment was that firms' ability to pass costincreases on to consumers had weakened considerably in recent months,resulting in smaller profit margins," the Fed said.
On the labor market front, the Beige Book said employment rose at aslight pace overall, with nine districts reporting very slow tomodest increases and the remaining three reporting no changes inemployment.
Wages grew at a moderate pace in eight districts, while the remainingfour noted only slight to modest wage increases, the Fed added. The Beige Book is typically released two weeks ahead of the Fed'snext monetary policy meeting, with the next meeting scheduled forApril 30-May 1.
CME Group's FedWatch Tool currently indicates a 99.5% probablity theFed will leave interest rates unchanged at the meeting.__dpa
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