The headline is yet again the same for the Beige Book which describes economic activity as modest to moderate. And modest is once again the description for inflation, including selling prices, with some wage pressures also cited again. Back in the January Beige Book, the majority of respondents described the labor market as tight and with this report some districts are saying labor shortages are "widening".
Retail sales are described as subdued with modest growth the description for the energy sector. Acceleration continues for manufacturing though the strength in the dollar is once again described as a headwind. Increased optimism after the election was cited in January but not in this report where less optimism is the call for the factory sector amid what the report describes as uncertainties among a few manufacturers over the new president's policies.
This report is tame in most respects but the question of widening labor shortages could catch the eye of the hawks and raise the chances for a rate hike at the March 14 and 15 FOMC. Today's report was compiled by the New York Fed with a response cutoff date of February 17.