The Federal Reserve's Brown Book released on Wednesday showed that in recent weeks, there has been almost no change in US economic activity, with strong consumer spending supporting the US economy, offsetting weakness in other industries such as manufacturing, and a cooling in the job market.
The Federal Reserve's Brown Book summarizes the results of 12 regional Federal Reserve surveys of the US economic situation, and this report is an important reference material for the Federal Reserve's monetary policy meeting.
The report states that consumers in most regions met expectations during the holiday period, with three regions including New York experiencing higher than expected consumption, providing some seasonal relief to the economy.
Most regional Federal Reserve states that there has been little change in economic activity during this period, but businesses are becoming increasingly optimistic about the future. The report states, "Overall, most regions indicate that their companies have positive or improved expectations for future growth, or a combination of both."
Enterprises have noticed that inflation pressure has eased during this period, including an increase in consumer sensitivity to prices, forcing retailers to compress profit margins and, in turn, resisting attempts by suppliers to raise prices. Most companies in different regions have mentioned examples of stable or declining raw material prices.
Almost all regions have mentioned signs of a cooling labor market, with over half believing that the overall employment level has hardly changed. Many companies in various regions expect salary pressures to ease, and salary increases will further decline next year.
The latest forecast from the Atlanta Federal Reserve shows that the annualized growth rate of the US economy is expected to reach 2.4% in the fourth quarter of last year, although lower than the growth rate of 4.9% in the third quarter, strong consumer spending will continue to drive economic development.
According to data released by the US Department of Commerce on Wednesday, retail sales in the US rose 0.6% month on month in December, the largest increase in three months and exceeding economists' expectations.
The first interest rate meeting of the Federal Reserve this year will be held from January 30th to 31st, and the market generally expects decision-makers to maintain interest rates unchanged for the fourth consecutive time.
Federal Reserve Governor Waller said on Tuesday that as inflation continues to decline, the Fed is expected to lower interest rates this year, but this process should be approached with caution and not rushed.