NAM: Fed’s latest Beige Book reports modest economic growth

The Federal Reserve’s latest Beige Book cites “steady consumer spending and an improving housing market” for “spurr[ing] modest US economic growth in the late summer,” the AP (10/15) reports, noting that the report “echoes other recent data that suggests the economy, while still expanding, has run into headwinds from overseas and lost momentum.”

MarketWatch (10/15) summarized the Beige Book as reporting “moderate consumer spending, generally weaker manufacturing, improving conditions for real estate, increased lending activity and tighter labor markets.”

According to the Wall Street Journal (10/15, Davidson, Subscription Publication), the Fed reported “continued modest expansion” in the US economy from mid-August through early October, with both the Boston and Richmond districts reporting increased economic activity while the Kansas City district reported a decline. While overall the report stated the businesses were “generally optimistic about the near-term outlook,” Fed districts pointed to the strong US dollar as the reason for restrained manufacturing activity, which was described as “generally weaker” over the last reporting period.

USA Today (10/14, Davidson) reports on the manufacturing front, “low oil prices curtailed investment in drilling equipment” but there was “healthy growth” in the automobile, “aerospace and transportation-equipment sectors.”

Reuters (10/14, Dunsmuir) states that most Fed districts reported tightening of labor markets, with some reporting labor shortages, especially for skilled workers.

WSJournal Analysis: Weak Economic Indicators Raise Doubt About 2015 Fed Rate Increase. According to a front-page piece in the Wall Street Journal (10/15, A1, Hilsenrath, Sussman, Subscription Publication), the weak economic numbers related to inflation, consumer spending, and jobs have seemingly eliminated a possible Federal Reserve rate increase this month and have raised doubts as to whether the rate increase will happen this year.

Associated Industries of Missouri is the sole official designated partner of the National Association of Manufacturers in Missouri.