Economic activity has declined in most districts over the past few weeks: Beige Book

The Federal Reserve Board (FRB) stated in Wednesday's Beige Book report that economic activity has been flat or declining in most districts of the Federal Reserve Board (FRB) over the past few weeks.

According to the report, economic activity increased slightly in three districts, but decreased or remained flat in nine districts compared to the previous five districts. The information was collected as of August 26, 2024.

Overall, employment levels remained stable. However, there were scattered reports of companies only filling necessary positions, reducing work hours and shifts, and reducing overall employment through workforce reductions. However, layoffs were rare.

According to the report, "Consumer spending was generally flat during the previous reporting period, but slightly decreased in most districts." This is important because consumer spending or spending on behalf of consumers accounts for about 70% of the economy.

"Manufacturing activity decreased in most districts, and two districts noted that these decreases were part of a continued contraction in the sector."

Since the previous Beige Book, prices have "modestly" increased, but in three districts, selling prices only rose slightly. "In many districts, both transportation costs and insurance premiums continued to rise. In contrast, some districts noted easing cost pressures for food, lumber, and concrete." The report states.

However, regarding the future, Federal Reserve Bank officials expect price and cost pressures to stabilize or further ease in the coming months.

A summary of the conditions in each district is as follows:

Boston, Chicago, Dallas, and others reported an increase in economic activity.

New York, St. Louis, Kansas City, and San Francisco saw stable or steady activity.

Philadelphia, Cleveland, Richmond, Atlanta, and Minneapolis reported a decline in economic activity.