By Arlenys Tabare
This Wednesday, the Federal Reserve revealed in its latest edition of the Beige Book how real high inflation is putting pressure on American consumers after the sharp increase in energy prices caused by the war with Iran.
At the moment, inflation is at 3.8%, according to the April report, one of its highest levels since 2023, and very far from the Fed’s objectives, which maintain interest rates in the range of 3.50% to 3.75%.
In the book, The Fed details the economic situation in which the 12 regional districts find themselves, commenting in its report that “prices increased at a moderate to strong pace in licensed, with most districts reporting higher inflation than in the previous report.”
The analysis highlighted that most of the high energy-related costs are linked to the conflict in the Middle East, this being the main driver of inflationary pressures.
On the other hand, analysts pointed out that The high costs of both fuel and fertilizers also caused agricultural production to remain partially stagnant. and in certain districts it will get worse.
In the book it was mentioned that “The business outlook for the next six months shows little change in expected growth.”due to high uncertainty and signs of weakening consumer spending, which negatively influence confidence”, all of this related to the strong economic uncertainty.
Finally, the report indicated that, The ability to pass on higher costs remained uneven across sectors, especially among companies that deal directly with consumers. “Several districts noted consumer uncertainty and concern about the impact of fuel prices on homes.”
Keep reading:
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- Sales in restaurant chains decreased in March due to the high increase in gasoline
- Economists from Bank of the United States assure that the FED will not cut interest rates until the second half of 2027
- US jobless claims rose more than expected in the last week of April
