WASHINGTON - The stable labor market and wage growth do not generate significant inflationary pressures, the report showed the Federal Reserve on Wednesday. About R eport darkens the outlook for economic growth on the eve of the meeting of politicians in September.
Overall, the economy continued to expand at a moderate pace in July and August, and respondents said that they expect continued growth "moderate" pace in the coming months. The data cover information on economic activity from early July to 29 August, information was obtained from the 12 district banks.
Most regions reported stable labor market and moderate growth in employment, which corresponds to the data of the Ministry of Labour for the last two months. Wage growth has not led to significant inflationary pressures, the report said. The rise in prices has been characterized as "generally insignificant."
The report mentioned some of the challenges facing the US economy. Recruitment has been stable for most of the period, but only in recent years wage growth has become more prominent. Low energy prices to contain inflation over the past two years. In July and August, according to the Beige Book, a record harvest put pressure on agricultural prices.
Fed officials expect inflation as a further increase in interest rates depends on it. In late August, Janet Yellen said that the probability of a rate hike in the federal funds have increased in recent months.
Study The Wall Street Journal found that more than two-thirds of the economists expect the Fed to raise rates no sooner than in December.
In a separate report released Wednesday by the Ministry of Labour, stated that the number of job openings in the US reached a record high of 5.9 million in July.
However, the hiring of new staff is not the most important. Companies also need to invest in equipment to increase employee productivity, which in turn will ensure sustainable growth. Business investment could increase productivity and corporate profits: the growth of both indicators has slowed in recent months. Ms. Yellen said that business investment has slowed, and is a significant cause for concern.
In the second quarter of consumers have been the main driver of economic growth. Consumer spending remained virtually unchanged in most regions during the reporting period, according to the Beige Book. Five regions reported a slight slowdown in car sales. Car sales reached a record level in 2015 and remain high, but it is not clear how the rate of purchases are stable.
Most regions reported a slight increase in manufacturing activity. Stabilization of the situation in the sector traced throughout most of the spring and summer, although a report last week from the Institute for Supply Management signaled the reduction of the industrial sector in August.
Business activity in the housing sector, which is another pillar of economic growth, continues to grow, but the report notes the limited supply of homes, which has affected the pace of sales in some areas. commercial real estate sector also continues to expand.
The report said that the sale of non-financial services has accelerated during the reporting period. Demand has increased in the restaurants, in the health sector and human resources services. However, the business activity index of the services sector showed a sharp drop in August to its lowest level in six years.
Banks reported that demand for loans has increased, although it differs in different regions.