U.S. Outlook: Insights from the Beige Book report
This month’s Beige Book report from the Federal Reserve was rather unusual.
It was quite a bit more interesting, shedding light on how the economy is faring under the onslaught of bad winter weather, drought in California, the West Coast port slowdown, and sluggish global growth.
For a detailed look at this and other developments, see my full weekly analysis. Highlights are outlined below, followed by a link to the full U.S. Outlook report, delivered on March 6.Key observations:
- The overall message from the report was generally positive.
- The strong gains in openings suggest the labor market momentum we have seen in recent months could be sustained for quite a while longer.
- The wild weather is once again playing havoc with the economic data in the first quarter.
- The report’s description of how businesses are handling the drop in energy and commodity prices gives us some good insights into how long and widespread the drop in consumer inflation is likely to be.