The Federal Reserve’s Beige Book, released on June 3, painted a picture of a US economy that continued to grow at a slight-to-moderate pace across most regions.
It also revealed a widening gap in consumer spending patterns: higher-income households remained resilient, while middle- and lower-income consumers came under increasing financial pressure.
The report noted a widening gap in consumer resilience. Higher-income households remain less sensitive to price increases, whereas middle- and lower-income consumers are pulling back on discretionary spending.
Manufacturing activity expanded at a moderate-to-strong pace in nine of the Fed’s 12 districts, supported in part by defense-related activity and demand from data centers.
Meanwhile, employment was largely unchanged across 11 districts, with only one district reporting slight job growth. Wage growth remained generally modest and broadly aligned with inflation, while businesses described a labor market characterized by both limited hiring and limited layoffs.
On prices, most districts reported moderate to strong inflationary pressures, generally higher than in the previous report.
Businesses cited energy costs linked to the conflict in the Middle East as a key source of inflation, while non-labor input costs continued to rise faster than selling prices, raising concerns about profit margins.
Moreover, the report highlighted that the ability to pass higher costs on to customers remained uneven across sectors, particularly among consumer-facing companies.
The Federal Reserve’s Beige Book, released on June 3, painted a picture of a US economy that continued to grow at a slight-to-moderate pace across most regions.
It also revealed a widening gap in consumer spending patterns: higher-income households remained resilient, while middle- and lower-income consumers came under increasing financial pressure.
The report noted a widening gap in consumer resilience. Higher-income households remain less sensitive to price increases, whereas middle- and lower-income consumers are pulling back on discretionary spending.
Manufacturing activity expanded at a moderate-to-strong pace in nine of the Fed’s 12 districts, supported in part by defense-related activity and demand from data centers.
Meanwhile, employment was largely unchanged across 11 districts, with only one district reporting slight job growth. Wage growth remained generally modest and broadly aligned with inflation, while businesses described a labor market characterized by both limited hiring and limited layoffs.
On prices, most districts reported moderate to strong inflationary pressures, generally higher than in the previous report.
Businesses cited energy costs linked to the conflict in the Middle East as a key source of inflation, while non-labor input costs continued to rise faster than selling prices, raising concerns about profit margins.
Moreover, the report highlighted that the ability to pass higher costs on to customers remained uneven across sectors, particularly among consumer-facing companies.
