Fed: Uncertainty hurting business optimism in US
WASHINGTON: US economic activity continued to expand at least modestly in recent weeks but political and trade uncertainty is undercutting optimism, the Federal Reserve said on Wednesday.
Companies also are concerned about volatility and rising interest rates, according to the Fed's "beige book" survey. And businesses continue to struggle to find and retain workers, despite rising wages, with some having to forgo work due to lack of employees, the report said.
"Outlooks generally remained positive," the Fed said, but in many of the 12 Fed districts "contacts had become less optimistic in response to increased financial market volatility, rising short-term interest rates, falling energy prices, and elevated trade and political uncertainty".
Nearly every region mentioned the impact of trade disputes and tariffs on manufacturing, retailers and other sectors. In some cases the impact was positive but expected to be temporary.
In Richmond, which includes the port of Baltimore, "ports saw robust activity in recent weeks" that they attributed largely "to orders being made early to avoid possible tariff hikes".
However, "they expected trade to soften in the next few months."
One Virginia company even had Chinese goods shipped through the west coast ports to beat the tariffs, the report said. - AFP