Economic activity grew at a modest to moderate rate, according to the Feds Beige Book although several districts noted that the pace of growth slowed this period, constrained by supply chain disruptions, labor shortages, and uncertainty around the Delta variant of COVID-19. A majority of Districts indicated positive growth in consumer spending; however, auto sales were widely reported as declining due to low inventory levels and rising prices. The Fed also said employment increased at a modest to moderate rate in recent weeks, as demand for workers was high, but labor growth was dampened by a low supply of workers. On the inflation front, the Beige Book said most districts reported significantly elevated prices, fueled by rising demand for goods and raw materials. Looking ahead, the report said outlooks for near-term economic activity remained positive, but some districts noted increased uncertainty and more cautious optimism than in previous months.
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