Fed's Beige Book Shows Economic Recovery On Course

(RTTNews) - The U.S. economy continued to expand at a "moderate to modest" pace over the summer as the labor market improved, according to the Federal Reserve's Beige Book.

"Reports from the twelve Federal Reserve Districts indicated that economic activity has expanded since the previous Beige Book report; however, none of the Districts pointed to a distinct shift in the overall pace of growth," the report said.

Some wage pressures due to skilled labor shortages were reported in the Beige Book's relatively upbeat assessment of the jobs market.

Consumer spending grew in most of the Fed's 12 districts, but reports on manufacturing were mixed.

The housing market was lackluster, as barely half of the Districts reported stable or growing residential real estate activity related to the construction of new homes and sales of existing houses.

Looking ahead, Philadelphia, Atlanta, Chicago, Kansas City, and Dallas explicitly reported that contacts generally remained optimistic about future growth, while other districts were optimistic about particular sectors.

The Beige Book is unlikely to alter the Fed's exit path from an extended period of ultra-accomodative monetary policies.

Economists expect the Fed to completely wind down its quantitative easing program this autumn, with rates to follow in mid-2015.

The Beige Book, published eight times a year, is the Fed's collection of anecdotal information on current economic conditions based on interviews with key business contacts, economists, market experts, and other sources.