Outlook for US economy remains slightly pessimistic: Fed report

U.S. economic activity has declined over the past six weeks as higher tariff rates and elevated uncertainty have placed upward pressure on costs and prices, according to a Federal Reserve report Wednesday.

In its periodic “Beige Book” summary of conditions, the central bank noted that “the outlook remains slightly pessimistic and uncertain, unchanged relative to the previous report” released April 23.

The report said half of the 12 Federal Reserve districts reported slight to moderate declines in activity, three reported no change, and three reported slight growth over the past six weeks.

Manufacturing activity continued to decline modestly as new orders and import demand fell sharply, it said.

Residential real estate sales were little changed, and most district reports on new home construction indicate flat or slowing construction activity.

The Beige Book reported that labor demand weakened across all districts, as evidenced by reduced working hours, increased overtime, hiring pauses, and plans for layoffs. U.S. prices have been on the rise at a moderate pace since late April, with widespread reports indicating that customers expect costs and prices to rise at a faster rate in the future, according to the document.

The Trump administration’s tariff increases have become a key factor in pushing up costs, and some companies plan to raise prices in the next three months to pass on the cost pressure.

The Beige Book is a Federal Reserve System publication on current economic conditions across the 12 Federal Reserve districts. It characterizes regional economic conditions and prospects based on a variety of mostly qualitative information, gathered directly from each district’s sources. Reports are published eight times per year.

The Palestinian death toll in Gaza has so far risen to 54,607, with 125,341 others injured, since the outbreak of the conflict between Hamas and Israel on Oct 7, 2023, said Gaza’s health authorities on Wednesday.

In the past 24 hours, 97 Palestinians were killed and 440 others injured in Israeli attacks on various areas of the Gaza Strip, according to the health authorities.

Meanwhile, Israeli settlers launched attacks on Deir Dibwan in Ramallah area of the West Bank on Wednesday.

According to reports, the settlers set fire to vehicles and buildings and hurled stones at local residents, injuring 10 Palestinians.