As it’s pretty long, I am posting my summary of the "National Summary" from the Fed's March Beige Book (Jan 6th through Feb 24th).
Overall it was less constructive than Jan’s w/the economy (outside of manufacturing), labor markets and consumer spending all marked down while prices were marked higher.
Economic activity "rose slightly” (from “slightly to moderately” in Jan) with six districts seeing “no change”, four “modest or moderate”, and two “slight contractions” (that is a deterioration from Jan which saw all twelve Districts with “modest or moderate” growth). But “[o]verall expectations for economic activity over the coming months were slightly optimistic.”
Consumer spending “was lower on balance” (from “moved up moderately”) although with “solid demand for essential goods” Like December there were mentions of “increased price sensitivity (which was missing in Jan) “particularly among low income shoppers”.
Manufacturing though “exhibited slight to modest increases across a majority of Districts” versus “decreased slightly on net” in Jan. As with Jan there were concerns about tariffs.
Construction (not mentioned in Jan) “declined modestly for both residential and nonresidential units,” with more tariff concerns.
Agricultural conditions “deteriorated some among reporting Districts,” versus “remained weak overall” in Jan.
Banking activity “was slightly higher on balance among Districts that reported on it,” verus “modest growth in lending” in Jan.
There was “modest growth in lending” from “subdued” in Nov, with some concerns about “delinquencies among small businesses and lower-income households.”
Residential real estate markets (not mentioned in Jan) were “mixed, and reports pointed to ongoing inventory constraints.”
No mentions of CRE, energy, or nonfinancial services which were noted in Jan.
In terms of labor markets, “employment nudged slightly higher on balance” from “employment ticked up on balance,” with four Districts reporting a slight increase (down from six), seven reporting no change (up from six),” and one a “slight decline” (up from none in Jan). “Multiple Districts cited job growth in health care and finance [healthcare growth was also noted in Jan], while employment declines were reported in manufacturing and information technology. Labor availability improved for many sectors and Districts, though there were occasional reports of a tight labor market in targeted sectors or occupations [versus “difficulty finding skilled workers” in Jan]. Contacts in multiple Districts said rising uncertainty over immigration and other matters was influencing current and future labor demand.”
“Wages grew at a modest-to-moderate pace, which was slightly slower than the previous report, with several Districts noting that wage pressures were easing.” As noted, the Jan report found wage growth “picked up to a moderate pace in most Districts”.
“Prices increased moderately in most Districts, but several Districts reported an uptick in the pace of increase relative to the previous reporting period.” That was up from “modest” increases “with growth rates ranging from flat to moderate” in Jan. Food prices were called out “higher prices for eggs and other food ingredients were impacting food processors and restaurants” as were “increases in insurance and freight transportation costs” which were “widespread.”
In a sign of margin pressure in line with the PMI’s “[i]nput price pressures were generally greater than sales price pressures, particularly in manufacturing and construction…Firms in multiple Districts noted difficulty passing input costs on to customers,” but “contacts in most Districts expected potential tariffs on inputs would lead them to raise prices, with isolated reports of firms raising prices preemptively.”
In total there were 49 mentions of tariffs throughout the Beige Book, up from 23 in Jan while “variations of the word uncertainty appeared 47 times” according to BBG.
https://www.federalreserve.gov/monetarypolicy/publications/beige-book-default.htm
