Fed’s Beige Book Notes Decline In Optimism About The Outlook, Sharp Drop In Broadway Attendance
by Tyler Durden
ZeroHedge.com
Mar 1, 2017
While largely considered among the less relevant of Fed indicators, once one gets beyond the traditional “modest to moderate expansion pace” summary of the economy, the Fed’s Beige Book release does in fact contain informative, and oftentimes useful anecdotes about the state of the economy as disclosed to the Federal Reserve. And since the latest, February, beige book comes at a time of major economic overhaul, it contained several particularly notable observations.
At the headline level, the Beige Book confirmed what is largely known, i.e., that the economy continues to expand at “a modest to moderate pace from early January through mid-February.” Some other observations:
Consumer spending expanded modestly since the last report.
Retail sales increased at a subdued pace across most of the nation, with a number of Districts noting an ongoing shift from in-store to internet purchasing.
Auto sales varied widely, but were said to be up in most Districts.
Tourism activity was mixed but mostly stronger.
Manufacturing activity accelerated somewhat, with most Districts characterizing the pace of growth as moderate.
The energy sector showed modest growth in early 2017, and transportation activity was steady to somewhat higher across the nation.
Home construction and sales continued to expand modestly in most Districts, while residential rental markets were mixed.
Home prices were steady to up modestly in most Districts, and a number of Districts noted low inventories of existing homes.
Commercial real estate construction grew modestly, and sales and leasing activity grew moderately. Lending activity was steady to somewhat higher.
And yet, at the very end of the economic activity summary was this somewhat surprising note: “Businesses were generally optimistic about the near-term outlook but to a somewhat lesser degree than in the prior report.” So was this the beginning of the end of the hope trade? Perhaps, although following today’s blow off top in the S&P, the trade may have reset itself again.
The Rest…HERE
