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US business optimism wanes over tariffs, rate hikes: Fed

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WASHINGTON:  US business optimism has fallen amid uncertainty over tariff disputes, rising interest rates and continued labour shortages, the Federal Reserve said on Wednesday.

The Fed's "beige book" survey of the economy showed the impact of President Donald Trump's punitive import tariffs has become more widespread, with cost increases felt by manufacturers, retailers and restaurants, restraining demand.

Even so, most regions of the US showed modest or moderate growth, and there were continued reports of companies increasing wages and benefits to attract and retain qualified workers, the report said.

"Most districts reported that firms remained positive; however, optimism has waned in some (districts) as contacts cited increased uncertainty from impacts of tariffs, rising interest rates, and labour market constraints," the Fed noted.

Mr Trump has imposed steep tariffs on steel, aluminium and about US$250 billion (S$352b) in imported goods from China, which has retaliated with tariffs on US goods. Washington and Beijing have agreed to negotiate a deal to resolve the dispute, but that could take another three months.- AFP