Economic activity was unchanged, on balance, since early July, with five districts reporting "slight to modest growth in activity" and five others reporting "slight to modest softening," the Fed said in its latest Beige Book, a survey on economic conditions based on information collected from its 12 regional reserve banks.
Substantial price increases were reported across all districts, particularly for food, rent, utilities, and hospitality services, the survey showed. While manufacturing and construction input costs remained elevated, lower fuel prices and cooling overall demand alleviated cost pressures, especially freight shipping rates.
Several districts reported some tapering in prices for steel, lumber, and copper, the survey showed, adding that most contacts expected price pressures to persist at least through the end of the year.
The #inflation over the last 18 months, visualised!
Manufacturing activity grew in several districts, although there were some reports of declining output as "supply chain disruptions and labor shortages continued to hamper production," according to the survey.
Overall labor market conditions remained tight, although nearly all districts highlighted some improvement in labor availability, particularly among manufacturing, construction, and financial services contacts.
Employers in several districts reported giving midyear and off-cycle raises to offset higher living costs, and many noted that offering bonuses, flexible work arrangements, and comprehensive benefits were deemed necessary to attract and retain workers.