ISTANBUL
US economic activity posted "little" change in most of the 12 Federal Reserve districts since the prior Beige Book, the Fed's latest Beige Book said on Wednesday.
The report, prepared with analyses from the central banks’ 12 districts, said economic activity in three districts reported "slight to modest" growth, five reported "no change," and four noted a "slight softening."
"Overall consumer spending, particularly on retail goods, inched down in recent weeks, although auto sales were boosted in some Districts by strong demand for electric vehicles ahead of the expiration of a federal tax credit at the end of September," it said.
Low- and middle-income households continued to favor discounts and promotions in the face of rising prices and ongoing economic uncertainty, it said.
It noted that manufacturing activity varied by region, and that challenging conditions continue due to high tariffs and weakening overall demand.
Future economic growth expectations vary by region and sector, and ongoing uncertainty is expected to continue to pressure economic activity in most regions, according to the Fed.
Labor demand 'muted," prices continue to rise
The report stressed that employment levels were largely stable in recent weeks, while demand for labor was generally "muted" across regions and sectors.
"In most Districts, more employers reported lowering head counts through layoffs and attrition, with contacts citing weaker demand, elevated economic uncertainty, and, in some cases, increased investment in artificial intelligence technologies," it noted.
Meanwhile, prices continued to rise during the reporting period, the report said, adding: "Several District reports indicated that input costs increased at a faster pace due to higher import costs and the higher cost of services such as insurance, health care, and technology solutions."
Tariff-induced input cost increases were seen in many regions, but the extent of those higher costs passing through to final prices varied.
"Some firms facing tariff-induced cost pressures kept their selling prices largely unchanged to preserve market share and in response to pushback from price-sensitive clients. However, there were also reports of firms in manufacturing and retail trades fully passing higher import costs along to their customers," it added.