Federal Reserve: Economy Grows at "Modest to Moderate Pace"
In the most comprehensive look at our economy since the government shutdown began, the Federal Reserve's Beige Book (link opens a PDF) points to slow expansion across most of the nation.
The Beige Book is published around two weeks before every Federal Open Market Committee monetary policy meeting and compiles data from all 12 Federal Reserve districts. Investors pay close attention to the Beige Book not only for its overarching economic data, but also as an indicator of whether the Federal Reserve may be about to switch up monetary policy.
In this latest report, the U.S. economy generally continued to grow at a "modest to moderate pace" between September and early October. While growth slowed in the Philadelphia, Richmond, Chicago, and Kansas City districts, the other eight districts reported steady growth.
Generally, the reserves were perceived to be "cautiously optimistic," but the recent government shutdown and debt ceiling debate took a cut out of confidence.
Consumers don't seem to suffer the same uncertainty, with consumer spending and tourism up in most regions. Auto sales are strong, and retailers are generally optimistic about this year's holiday spending season.
While nonfinancial services, manufacturing, and construction and real estate trended upward over the past month, the finance sector stayed steady (partially because of higher mortgage rates), and heavy rains and drought hurt agricultural production in six districts.
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