Canaccord Genuity Morning Coffee on Beige Book: Beige is the New Pink

June 7, 2012 10:17 AM EDT Send to a Friend
Canaccord Genuity Morning Coffee on Beige Book: Beige is the new pink.

The Fed’s most recent Beige Book showed the U.S. economy expanded at a moderate pace between early April and late May, though turmoil in Europe and political uncertainty in the U.S. worried some employers. The economy expanded at a moderate or modest pace in 12 of the districts survey. Hiring remained steady while manufacturing continued to expand in most districts. The overall economic outlook remained positive, “but contacts were slightly more guarded in their optimism.” Additionally, “contacts in a number of districts were concerned that a slowdown in Europe and domestic political uncertainty may affect future business conditions.” Looking at labour markets, manufacturing, construction, information technology and professional-service sectors appeared the strongest and “firms continued to face difficulty finding highly trained or skilled workers.” Real estate was positive overall, although “there were a few reports of increased uncertainty from still unknown U.S. fiscal changes and Europe’s debt situation.” The Beige Book will be used for discussion at the next Fed policy meeting on June 19th and 20th. At the most recent policy meeting in April, officials said they expected to keep rates near zero until 2014; however recent macro concerns have led many to speculate that the Fed will have to do more to stimulate growth. The generally upbeat tone of the Beige Book may also indicate that no further easing is on the way.


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