The US economy grew in recent weeks, while businesses still took a rosy view of the near future, despite the US-China trade dispute, the US Federal Reserve said on Wednesday.
The latest “beige book” survey, which gathers anecdotal reports from businesspeople and other contacts in the Fed’s 12 districts, said that growth had continued “at a modest pace.”
The Fed said that there was an array of softening or deteriorating conditions just as concrete signs emerge that the trade conflict is weighing on growth.
“Although concerns regarding tariffs and trade policy uncertainty continued, the majority of businesses remained optimistic about the near-term outlook,” the central bank said in the report.
Anecdotal reports say that auto sales rose and tourism was “solid,” while bank lending and commercial real-estate leasing increased a little, the Fed said.
Farms were beset by a trio of woes: bad weather, low prices and uncertainties over trade, while consumer spending was “mixed” outside the auto sector, demand for transportation softened, home sales “remained constrained” and housing construction was flat.
Across the US, employers complained that they had difficulty finding workers to fill open positions and faced “strong upward pressure” to offer higher pay to entry-level and low-skill workers.
However, employers increased benefits, such as more flexible work arrangements and signing bonuses, the report said.
Inflation remained tame, it said.
While some companies said that they were able to pass on price increases, manufacturers complained that there were limits on how much they could do.
“District reports on the impact of tariffs on pricing were mixed, with some districts anticipating that the effects would not be felt for a few months,” the report said.
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