FX.co ★ Fed's Beige Book Says U.S. Economic Activity Rose Slightly

In its latest Beige Book, the Federal Reserve reported a slight rise in economic activity across most of its districts. This document provides anecdotal insights into the economic conditions of each of the twelve districts governed by the Fed.

Released on Wednesday afternoon, the Beige Book highlighted modest or moderate growth in three regions, which helped offset stagnant or slightly declining activity in two other regions.

"Although the overall growth in economic activity was limited, there was a moderate increase in growth expectations across most regions and industries," stated the Fed. "Business contacts conveyed optimism about an anticipated rise in demand in the coming months."

Consumer spending was labeled as generally stable, but the Fed noted an increase in price sensitivity among consumers in many districts.

The Fed also indicated that prices increased at only a modest rate, with both consumer-oriented and business-oriented contacts encountering greater challenges in passing costs on to consumers.

With anticipation building for the Labor Department’s upcoming monthly employment report on Friday, the Beige Book revealed that employment levels were either flat or experienced only slight growth across the districts.

Although hiring activity remained muted due to low worker turnover and few firms expanding their workforce, the Fed reported a continued low incidence of layoffs.

The Beige Book is traditionally published two weeks prior to the Fed's next monetary policy meeting, which is set for December 17-18.

According to the CME Group's FedWatch Tool, there is presently a 75.5 percent probability that the Fed will reduce interest rates by an additional 25 basis points.