The latest Beige Book report on regional conditions has arrived, and the story on prices sounds very familiar.
Price pressures have intensified in a number of Districts, and most report that high or rising energy prices are a concern across sectors...
Reports from many Districts suggested that upward price pressures have strengthened, although actual increases to date in vendor prices and selling prices have generally remained moderate. Much of the pressure derives from energy costs, although contacts cited the lower dollar and rising costs of building materials as well. Most Districts said manufacturers, retailers, or services firms were able to pass at least a portion of cost increases along to their customers.
On the other hand, the tone of the report regarding general economic conditions was almost cheery in light of the string of less-than-stellar reports we've been getting lately.
Reports from all twelve Federal Reserve Districts indicate that business activity continued to expand from late February through early April. Kansas City and San Francisco noted solid growth, Chicago and Dallas characterized growth as moderate, and Atlanta reported a robust pace. By contrast, while citing positive growth, New York and Cleveland mentioned uneven progress across sectors, and Richmond stated that signs of improvement in April followed a restrained March.
More than one-half of the Districts reported that retail activity was up, from modestly to strongly. Among the remaining Districts, Chicago said consumer spending was subdued, Dallas noted that retailers were disappointed with recent growth, and Cleveland reported some deterioration after improvement earlier in the year...
Districts described manufacturing activity as ahead of year-earlier or previously-reported levels, with reports ranging from "rising briskly" in the Kansas City District to "continuing at solid levels" for contacts around Chicago. Information on service industries was generally positive. Residential real estate markets remained strong across most of the country, while commercial real estate conditions varied.