The US economy suffered a slowdown, which caused its growth rate to weaken slightly at “a moderate pace”. This is what emerges from the Beige Book, the report on the economic conditions of the United States that the Fed publishes eight times a year and whose latest edition refers to the months of July and August.
The slowdown was attributed to fears related to the health situation in the US, linked to the spread of the Delta variant.
“The deceleration in economic activity is largely attributable to the turnaround in travel, dining, tourism, which has affected most districts, and which has mirrored safety concerns due to increased traffic. cases of the Delta variant and, in some cases, international travel restrictions, “the report reads.
At the same time, with regard to inflation, the Beige Book confirmed that American companies are facing an increase in costs, aggravated by the shortage of raw materials and production goods; in many areas, according to the Federal Reserve, businesses will likely be forced to pass the cost increase onto consumers.
The Fed’s report found that, in general, inflation “is solid at a high pace”: half of the 12 districts surveyed by the central bank indicated “strong” pressure and the other half that they spoke of pressure. ” moderate “.
However, the details of the report show that the inflation problem is escalating. The Fed’s preferred inflation metric rallied 3.6% in July, and several other indicators reported even higher growth.