Beige Book Again Sees Modest-to-Moderate Growth

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This is a good example of how the government cut in spending affected the economy – It Didn’t. Please read the article below and let me know what you think.

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Continuing to shrug off sequester cutbacks, but feeling the effects of adverse weather, the nation’s economy “continued to expand at a modest to moderate pace” from early July through late August, the Federal Reserve reported Wednesday in its Beige Book assessment.

The Beige Book, formally the “Summary of Commentary on Current Economic Conditions by Federal Reserve District,” is issued eight times a year, about two weeks before each meeting of the Federal Open Market Committee (FOMC), the Federal Reserve’s policy setting arm. The FOMC’s next meeting is scheduled for September 17-18. Though eagerly anticipated by investors, the Beige Book is rarely discussed at the FOMC meetings.

Echoing—or perhaps anticipating—FOMC concerns, the Beige Book said “hiring held steady or increased modestly” while “upward price pressures remained subdued, and prices increased slightly.”

The FOMC has said it will consider curtailing or tapering its stimulative easy money policy when the unemployment rate falls to 6.5 percent and inflation rises to 2.0 percent, easing concerns about disinflation which could threaten a still fragile recovery.

“Residential real estate activity increased moderately in most Districts, and demand for nonresidential real estate gained overall,” the Beige Book said in its anecdotal recap. “Lending activity was mixed. Lending standards were largely unchanged, while credit quality improved. Demand for agricultural products was strong during the reporting period, but growing conditions and production in some areas were somewhat weak as a consequence of extreme weather.”

To read the complete article – please use the link below.

Modest-to-Moderate Growth

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