Fed Beige Book "Growth Slows in Some U.S. Regions"

[Asia Economy New York=Special Correspondent Joselgina] The U.S. central bank, the Federal Reserve (Fed), diagnosed on the 1st (local time) that economic growth has begun to slow in some regions.

In the Beige Book, an economic trend report released that day, the Fed stated that the economy in most parts of the U.S. recently grew at a "slight or modest" pace. This assessment covers the economic conditions of the 12 Federal Reserve Banks' districts from mid-April to May 22. It will be used as basic data for the June Federal Open Market Committee (FOMC) regular meeting scheduled for the 14th-15th.

The Beige Book mentioned, "Four districts experienced a slowdown in growth compared to the previous survey period." This is interpreted as reflecting the impact of the Fed raising the benchmark interest rate by 0.25 percentage points in March and by 0.5 percentage points in May. The previous report described the U.S. economy as growing at a "moderate pace."

Additionally, the Beige Book specified that inflation is affecting not only housing but also retail sectors. The report stated, "Retail businesses have seen some easing of demand as consumers face high prices," and "The residential real estate sector has also witnessed a weakening in demand as buyers confront high home prices and soaring interest rates."

However, despite concerns about economic slowdown, the Fed's rate hike trajectory is expected to continue. Earlier, Fed Chair Jerome Powell confirmed his intention to maintain tightening until inflation clearly slows down, even if some pain is involved.

Mary Daly, President of the San Francisco Fed, also emphasized in an interview with CNBC that day, "We will do what is necessary to bring inflation down to the required level," adding, "What the Fed needs to do is remove accommodative measures." She stated, "The benchmark interest rate should reach the neutral rate by the end of the year," and supported a 0.5 percentage point rate hike at least through June and July.

James Bullard, President of the St. Louis Fed, known as a representative hawkish (favoring monetary tightening) figure, also reinforced tightening in a speech at the Memphis Economic Club that day, saying, "We are at risk of losing control over inflation expectations."

This content was produced with the assistance of AI translation services.