We may be lacking official government data, but the Federal Reserve is still working and speaking to contacts throughout the economy. The messages back aren’t particularly comforting though, and this will keep the Fed in cutting mode for the next several months.
Fed Confirms It Has Seen Little Sign of Improvement
The Federal Reserve isn’t directly impacted by the government shutdown, and they have just released their report, which is an anecdotal survey on the state of the US economy. It suggests there has been a slight loss of momentum in activity over the past eight weeks, which supports the messaging from Fed Chair Jerome Powell yesterday that the economic situation hasn’t improved since the Fed cut rates 25bp on 17 September.
The report suggests that, on balance “economic activity changed little” since the last report, with 3 of 12 Fed districts reporting slight to modest growth, five reporting no change and four reporting a slight softening. This is a loss of momentum relative to the August report, which had indicated 4 of 12 Fed districts reporting “modest growth” with the other eight indicating “little or no change in economic activity”. In terms of the jobs market, it was suggested that “demand for labour was muted across districts and sectors
Federal Reserve Beige Book Gives the Greenlight to Further Rate Cuts
