Federal Reserve Beige Book: U.S. Economic Activity Largely Stable
On October 15, 2025 (ET), the Federal Reserve released its latest Beige Book, noting that overall U.S. economic activity has changed little since the prior report, with most districts describing growth as modest to flat. Most districts reported modest consumer spending, softer demand for durable goods, and resilient essentials. Travel and dining were mixed, with business travel steady and some softening in leisure.
The labor market showed signs of cooling, with slower hiring and fewer vacancies, easing tightness at the margin. Wage growth continued to decelerate, though it remains above pre-pandemic levels. On prices, firms cited easing input cost pressures, smoother supply chains, and limited ability or need to raise final prices; inflation pressures were described as moderate, with sticky housing and some service prices.
Signals from manufacturing and construction were mixed: factory orders fluctuated slightly and capital expenditures were more cautious; residential construction cooled under higher mortgage rates, while infrastructure and energy-related projects provided some support. Financial conditions remained tight, with borrowing costs high and bank lending standards firm; small businesses voiced concerns about credit costs and demand uncertainty.
Looking ahead, contacts were cautiously optimistic, expecting broadly stable activity in coming months while remaining alert to consumer demand, inventory adjustments, and policy and geopolitical uncertainties. The Fed said it will continue monitoring labor and inflation trends to assess the policy path.
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