2023-10-18 20:50:00
The Fed displays measured optimism. The prospects for a soft landing for the American economy seem to be materializing, with a slightly less tense job market, except for the most qualified employees, according to its latest survey published Wednesday. “ The short-term outlook for the economy was generally described as stable with somewhat weaker growth », Details the Fed in its “Beige Book”.
Of the twelve American regions studied by the Fed, six are experiencing stable or slightly declining activity, while the other half are seeing their activity increase slightly. This report, which generally appears two weeks before the next monetary meeting, covers a period of six weeks before October 6. “ Consumer spending was mixed, particularly in retail and auto, due to a difference between prices and available supply “, boasts the Fed.
Services are better
However, services are getting better, nevertheless “ tourist activity (which) continued to improve » but is also starting to show signs of weakness. “ Some regions reported a slight slowdown in travel spending ».
High interest rates, due to the increase made by the Fed over the last 19 months, are making credit more expensive, with an impact on the activity of banks, where loan requests are down slightly. On the labor market side, the existing tension seems to be disappearing little by little, between employers who “ no longer feel pressured to recruit » and an increase in the number of candidates per job offer.
As for inflation, sales prices are growing less quickly than producer prices, which makes it more difficult for companies to maintain their margins. Overall, prices are expected to rise over the coming quarters but at a slower pace than that observed so far.
The strikes observed in the automobile manufacturing sector, particularly in the north of the country, have had no effect on the economy of the regions concerned. But they are, however, beginning to be taken into account in the perspectives of the Chicago and Cleveland regions, notes the Beige Book.
Inflation stable
Finally, overall inflation rose in September to 3.7% over one year, stable compared to the previous month, and 0.4% over one month, according to the CPI index, to which pensions are indexed. The next Fed meeting will be held on October 31 and November 1.
As a reminder, during its last meeting on September 19 and 20, the Fed maintained its main key rate in the range of 5.25 to 5.50%, its highest level since 2001. Officials, however, reported that they might still meet them by the end of the year.
The decision will be taken at the end of the month, during the next meeting of the institution, on October 31 and November 1. The position that the American Reserve must adopt to combat inflation constantly arouses debate between ” hawks “, followers of a restrictive monetary policy, and the ” doves », advocating a more flexible approach within the Fed.
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