The Federal Reserve released its Beige Book report on the country’s economic health on Wednesday, saying the U.S. economy remained “generally weak” as regional banks across the country reported contractions.
The survey found that the five districts represented by New York, St. Louis, Minneapolis, Richmond and Chicago all saw contraction in economic and business activity, while growth occurred in the five districts represented by Atlanta, Dallas, Kansas City, San Francisco and Boston, according at the Federal Reserve. Despite nine of the twelve districts reporting an easing in inflationary pressure, prices are expected to remain “very high” at least until the end of the year, with basic necessities such as food, rent and public services being among the hardest hit.
“Most regional banks are watching their respective economies at dawn as the brief and anemic growth of the third quarter gives way to outright declines,” EJ Antoni, regional economics researcher at the Data Analysis Center of the Heritage Foundation. , told the Daily Caller News Foundation. “About half of the regions are already in contraction territory. There are already widespread declines in new orders [for businesses]a forward-looking indicator. (RELATED: Famous Investor Who Predicted 2008 Stock Market Crash Warns of ‘Tragedy’)
In August, the Federal Reserve Banks of New York, dallas, philadelphia cream and richmond each reported that new manufacturing orders were down, which Antoni warned is a sign of weakening economic conditions. These results are consistent with the results of the global Purchasing Managers’ Index (PMI), which showed that the global economy was contracting as new orders fell, with the United States contracting at the fastest rate. , according to a Tuesday report from S&P Global and JP Morgan Chase.
Even where contractions have not yet started, growth is noticeably slowing, Antoni told DCNF.
“As economic activity everywhere slows, the places that already had the slowest growth are only the first to enter contraction territory,” he said.
Conclusion: “Prospects for future economic growth remained generally weak, with contacts noting expectations of further easing in demand over the next six to twelve months.”
No recession, but one is coming
— Edward Harrison (@edwardnh) September 7, 2022
According to the Federal Reserve, businesspeople and other experts polled in Philadelphia, Chicago, Dallas and Boston all expressed concern about a recession. Nearly three-quarters of private economists believe the Federal Reserve will cause a recession if it succeeds in reducing inflation over the next two years, according to an Aug. 22 report. report by the National Association of Business Economics.
Federal Reserve Chairman Jerome Powell continued registration in an August 26 speech, “some pain” for businesses and households was an acceptable consequence for the Fed to contain inflation.
The Federal Reserve is expected to raise interest rates at its next meeting as part of ongoing efforts to fight inflation, but it is uncertain whether it will do so by 0.5% or 0, 75%, according at Bloomberg.
The Federal Reserve Board of Governors did not immediately respond to a request for comment from the Daily Caller News Foundation.
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