Fed Saw ‘Modest to Moderate’ Growth amid Budget Impasse

Consumer spending maintained gains and business investment grew, according to the Fed's Beige Book.

Four of the 12 Federal Reserve districts reported slower economic growth while eight others said the expansion held steady amid “uncertainty” stemming from the U.S. fiscal deadlock, the central bank said today.

Growth remained “modest to moderate” as consumer spending maintained gains and business investment grew, the Fed said today in its Beige Book business survey. The report provides policy makers anecdotal accounts from the Fed districts two weeks before they meet to set monetary policy.

Background Checks

In the New York Fed district, an employment agency said “the government shutdown has hampered efforts to do background checks on prospective employees, whereas another contact indicates this has not been problematic thus far.”

Growth Rate

The world’s largest economy expanded at a 2.5 percent annualized pace in the second quarter, beating economist estimates, after growing at a 1.1 percent pace in the first quarter.

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