Inside the Fed’s Beige Book (Aug. 2025): Real-Time Clues on the US Economy

National Summary

This report was prepared at the Federal Reserve Bank of Philadelphia based on information collected on or before August 25, 2025. This document summarizes comments received from contacts outside the Federal Reserve System and is not a commentary on the views of Federal Reserve officials.

Overall Economic Activity

Most of the twelve Federal Reserve Districts reported little or no change in economic activity since the prior Beige Book period—the four Districts that differed reported modest growth. Across Districts, contacts reported flat to declining consumer spending because, for many households, wages were failing to keep up with rising prices. Contacts frequently cited economic uncertainty and tariffs as negative factors. New York reported that "consumers were being squeezed by rising costs of insurance, utilities, and other expenses." Contacts observed the following responses to the consumer pullback. Retail and hospitality sectors offered deals and promotions to help price-sensitive consumers stretch their dollars—supporting steady demand from domestic leisure tourists but not offsetting falling demand from international visitors. The auto sector noted flat to slightly higher sales, while consumer demand increased for parts and services to repair older vehicles. Manufacturing firms reported shifting to local supply chains where feasible and often using automation to cut costs. The push to deploy AI partly explains the surge of data center construction—a rare strength in commercial real estate noted by the Philadelphia, Cleveland, and Chicago Districts. Atlanta and Kansas City reported that data centers had increased energy demand in their Districts. Overall, sentiment was mixed among the districts. Most firms either reported little to no change in optimism or expressed differing expectations about the direction of change from their contacts.

Labor Markets

Eleven Districts described little or no net change in overall employment levels, while one District described a modest decline. Seven Districts noted that firms were hesitant to hire workers because of weaker demand or uncertainty. Moreover, contacts in two Districts reported an increase in layoffs, while contacts in multiple Districts reported reducing headcounts through attrition—encouraged, at times, by return-to-office policies and facilitated, at times, by greater automation, including new AI tools. In turn, most Districts mentioned an increase in the number of people looking for jobs. However, half of the districts noted that contacts reported a reduction in the availability of immigrant labor, with New York, Richmond, St. Louis, and San Francisco highlighting its impact on the construction industry. Half of the Districts described modest growth in wages, while most of the others reported moderate growth. Two Districts noted little or no change in wages.

Prices

Ten Districts characterized price growth as moderate or modest. The other two Districts described strong input price growth that outpaced moderate or modest selling price growth. Nearly all Districts noted tariff-related price increases, with contacts from many Districts reporting that tariffs were especially impactful on the prices of inputs. Contacts in multiple Districts also reported rising prices for insurance, utilities, and technology services. While some firms reported passing through their entire cost increases to customers, some firms in nearly all Districts described at least some hesitancy in raising prices, citing customer price sensitivity, lack of pricing power, and fear of losing business. In some cases, as highlighted by Cleveland and Minneapolis, firms reported being under pressure to lower prices because of competition, despite facing increased input costs. Most Districts reported that their firms were expecting price increases to continue in the months ahead, with three of those Districts noting that the pace of price increases was expected to rise further.

Highlights by Federal Reserve District

Boston

Economic activity expanded slightly overall, but consumer spending was flat. Employment was down slightly, while wages and prices increased modestly. Home sales increased moderately from a year earlier. The outlook remained cautiously optimistic on balance, although tariff-related uncertainty dimmed the outlook for consumer spending.

New York

Economic activity declined slightly as tariff-related uncertainty continued to weigh on businesses. Employment in the region was mostly unchanged, and wage growth remained modest. Selling prices rose at a moderate pace, marking some acceleration since the previous reporting period, and input prices rose strongly.

Philadelphia

Business activity increased modestly in the current Beige Book period. Employment levels held steady, and wages rose at modest pre-pandemic rates. Firm prices rose moderately, straining budgets for many households and small businesses, and inflation expectations are higher still. In addition, tariffs and federal budget cuts are expected to add additional stress. Still, expectations for future growth broadened among most firms.

Cleveland

Fourth District business activity increased slightly in recent weeks, and contacts expected activity to rise modestly in the months ahead. Manufacturers reported flat demand because of uncertainty, and retailers said sales were flat because of affordability concerns. Contacts said cost growth remained robust, while their selling prices increased modestly.

Richmond

The regional economy grew modestly in recent weeks. Consumer spending drove the overall growth as activity in non-consumer-facing sectors of the economy was flat to down slightly. In particular, manufacturing activity was down modestly this cycle. Employment levels were largely unchanged, and wage growth remained moderate. Price growth remained moderate, overall, despite some pickup in price growth in the services sector.

Atlanta

The Sixth District economy declined slightly. Employment remained steady, and wage pressures moderated. Prices rose moderately. Consumer spending slowed, leisure travel fell, and business travel was flat. Home sales rose slightly; commercial real estate weakened. Transportation and manufacturing declined modestly. Lending at District banks increased. Energy activity rose.

Chicago

Economic activity in the Seventh District increased modestly. Consumer spending increased moderately; manufacturing activity increased modestly; employment and business spending increased slightly; nonbusiness contacts saw no change in activity; and construction and real estate activity declined slightly. Prices rose moderately, wages rose modestly, and financial conditions loosened slightly. Prospects for 2025 farm income were unchanged.

St. Louis

Economic activity and employment levels have remained unchanged while wages and prices have increased at a faster pace in the recent past. Contacts continue to express a high degree of uncertainty and concern about the impact of immigration policies on labor supply; they expect prices to accelerate over the next year due to tariffs. The outlook remains slightly pessimistic, but deterioration has subsided.

Minneapolis

District economic activity contracted slightly. Employment fell as labor demand softened. Wage pressures were moderate, and prices ticked up modestly. Consumer spending fell as price sensitivity rose. Manufacturing also fell, with wide variation among contacts. Commercial and residential construction improved slightly, and home sales rose slightly. Agricultural conditions remained weak, given poor commodity prices and despite good crop conditions.

Kansas City

Economic activity was generally flat across the district. Employment declined modestly, and wage pressures remained subdued, although growth in non-wage benefit expenses caused total labor costs to rise. Input price growth was broad-based and contributed to moderate growth in selling prices, declines in profit margins, and expectations of sustained price pressures.

Dallas

Economic activity in the Eleventh District economy rose modestly, buoyed by a pickup in nonfinancial services and manufacturing activity. Loan demand grew, but the housing market remained weak. Employment was flat, and staffing firms noted slow hiring activity. Price pressures persisted, particularly in the manufacturing sector. Outlooks improved, but there was widespread trepidation regarding shifting trade policy, high interest rates, and more restrictive immigration policy.

San Francisco

Economic activity edged down slightly. Employment levels were down slightly. Wages grew somewhat, and prices rose modestly. Conditions in agriculture, retail trade, and consumer and business services sectors eased slightly. Manufacturing activity declined modestly. Conditions in residential and commercial real estate were largely unchanged, and lending activity was stable.

District-by-District Highlights

Federal Reserve Bank of Boston

Slight expansion. Prices and wages are up modestly. Consumer/tourism soft; manufacturing and staffing inch up; residential improves on inventory; commercial real estate remains weak. Outlook: cautious outside CRE.

Overall activity

• Economy expanded slightly with mixed sector results; sentiment cautious outside CRE/retail/tourism.

Labor markets

• Employment down slightly overall; wage growth modest.
• Manufacturers trimmed a bit; restaurants lower vs. a year ago; retail/hospitality flat.
• Firms favor temporary hires; hiring selective with longer time-to-fill.
• Labor supply improved; white-collar candidates less picky but prefer remote/hybrid.

Prices

• Modest price increases overall.
• Tariffs pushed some retail markups (10–15%) and manufacturing input costs; firms hesitant to pass through fully.
• Restaurants raised menus slightly; hotel rates up despite lower occupancy. Some inputs (e.g., dairy) fell y/y.

Retail & tourism

• Retail/restaurant sales roughly flat; one home-goods retailer gained share despite sector softness.
• Tourism softened: Boston air traffic flat; domestic down slightly, international up; hotel occupancy down modestly.
• Tariffs + high uncertainty seen as headwinds to future spending.

Manufacturing

• Sales up modestly on average; wide dispersion by firm.
• AI-related demand a notable support; data-storage rebound after inventory drawdowns.
• Capex mostly steady; outlook: modest-to-moderate growth.

Staffing services

• Slight activity increase q/q; big y/y gains at one firm (temp roles).
• Billing rates flat; pay rates up slightly; onboarding/health costs rising.
• Improving optimism, expecting demand for admin/engineering/light industrial roles.

Commercial real estate (CRE)

• Activity up slightly but still weak overall.
• Retail rents up moderately; office leasing up a touch (large firms) but Boston trails NYC’s rebound.
• New construction limited; industrial leasing sluggish; multifamily stable with flat rents.
• High rates and tariffs dampen activity; outlook pessimistic on balance.

Residential real estate

• Single-family sales up moderately y/y on rising inventories and steady demand.
• Condo sales mixed; overall slightly higher.
• Prices: SFH up moderately to above-average in most states (Vermont down; CT n/a); condo prices varied.
• Inventories up (especially condos), but supply still tight; optimism that rising inventory will support sales.

For more information about District economic conditions, visit: https://www.bostonfed.org/in-the-region.aspx

Federal Reserve Bank of New York

Slight decline in overall activity. Jobs flat, wages modest. Prices rising faster—inputs strong on tariffs; more firms planning hikes. Services fell; manufacturing ticked up. Consumer spending up slightly but squeezed by utilities/insurance. Housing steady with tight supply and rising prices; NYC rents at records. CRE leasing improved (Class A Midtown strong); construction down. Banks see weaker loan demand and deposits despite eased standards. Outlook slightly pessimistic.

Overall activity

• Slight contraction district-wide, driven by a moderate drop in services; manufacturing rebounded modestly after a slump.
• Tariff uncertainty weighs on plans; businesses slightly pessimistic about the outlook.

Labor markets

• Employment mostly unchanged; some declines (information, construction, education/health) offset by gains (personal services, wholesale).
• Labor supply > demand in many industries; firms cautious on staffing; no major layoffs.
• Persistent shortages in manufacturing, healthcare, construction (immigration drop causing delays).
• Wages modest overall; stronger in construction and leisure/hospitality.

Prices

• Pricing pressures up: selling prices moderate; inputs strong (tariffs, insurance, utilities).
• Some industries absorbed costs (autos) but others passed through tariffs (e.g., European steel); more firms plan price hikes.

Consumer spending

• Up slightly, but households squeezed by higher insurance/utility bills, limiting discretionary spend.
• Home-related retail soft on low sales; alcohol sales slow; restaurants see more traffic but lower ticket sizes.
• Auto sales modestly rebounded after a summer pause.

Manufacturing & distribution

• Modest pickup in orders/shipments; tariff uncertainty delays decisions.
• Supply chain frictions: domestic suppliers backlogged; input delays; selective product shortages (pine logs).
• Wholesale/distribution slightly higher; trucking rates subdued on weak demand; inventories down.
• Anticipated modest growth ahead; concerns about shipping capacity limits (China-built ships restrictions).

Services & tourism

• Service activity declined moderately, especially retail, leisure/hospitality, education/health.
• NYC tourism edged up: domestic solid; international soft (fewer Canadians). Hotel occupancy high with record ADRs, but attractions and Broadway attendance lag. World Cup expected to boost 2026 summer outlook.

Real estate & construction

• Housing steady with solid demand and slowly rising supply; prices rising across most areas; bidding wars common in suburbs/upstate.
• NYC rents at historic highs, partly after new broker-fee rules.
• CRE improving: leasing surged; vacancies down; Class A Midtown achieving record rents; industrial strong in N. New Jersey.
• Building sales down in NYC but some recent positives; construction activity declining.

Banking & finance

• Broad finance activity picking up, but small/mid banks report weaker loan demand and shrinking deposits.
• Credit standards eased across products; delinquencies improved overall, but auto repossessions are ticking up.

Community perspectives

• Healthcare worker shortages in rural areas; funding constraints could worsen access.
• Anticipated Medicaid changes may reduce services (incl. potential hospital closures) and increase uncompensated care; work requirements may aggravate childcare shortages.

For more information about District economic conditions, visit: https://www.newyorkfed.org/regional-economy.

Federal Reserve Bank of Philadelphia

Activity rose modestly after a prior dip. Jobs flat; wages back to modest, pre-pandemic pace—and lag inflation for many entry-level/lower-income workers. Firms’ own prices up moderately and inflation expectations >4.6%; tariffs and tighter credit strain small businesses. Outlook broadened, stronger in manufacturing than in services.

Overall activity & outlook

• District activity increased modestly; sentiment improved versus the last period.
• Expectations for next six months broadened across sectors, led by manufacturers; non-manufacturers more cautious.

Labor markets

• Employment unchanged overall; manufacturing headcount up modestly; average workweek rose.
• More candidates available (some layoffs), yet skills gaps persist.
• Firms cautious: automation/AI adoption trimming openings; workers “hunkering down.”
• Wage growth steady at modest pace; some entry-level salaries lowered at smaller firms; urban hotels see upward pressure due to unions.
• One-year-ahead compensation (trimmed mean) 3.3% in Q3 (down from 3.7% in Q2; ≈ 3.2% pre-COVID).

Prices

• Firms’ own prices increased moderately; trimmed mean 2.9% (Q3) vs 2.8% (Q2); prior five-quarter avg 2.0%.
• Price sensitivity rising: >half of customers more price-sensitive; nonprofits report higher demand for basics.
• Tariffs expected to push prices higher; one-year-ahead own-price expectations 3.3% (up from 3.1% in Q2 & 2.6% in Q1).
• Inflation expectations (all firms, trimmed mean) 4.7% for Q3, up from 3.0% last year.

Manufacturing

• Modest overall gain; July orders/shipments up, August flat/down.
• Optimism high: ~60% expect increases in orders/shipments over six months.

Trade & services (non-manufacturing)

• Activity rebounded to moderate growth after a prior decline; orders/revenues rose (July modest, August moderate).
• Retail (ex-auto) up slightly, aided by promotions.
• Autos up slightly; pre-tariff inventory nearly gone; tariffs beginning to raise new-car prices; OEMs boosting incentives.
• Tourism slipped slightly; luxury travel was the lone bright spot.
• Forward-looking non-manufacturing index still below its non-recession average.

Real estate & construction

• Existing-home sales and inventories ticked up (June–July); some sidelined buyers are returning.
• New-home sales up slightly after earlier declines.
• Nonresidential: leasing/transactions slightly higher; construction still slightly down (despite some data centers/power projects). Wider use of escalator clauses and larger contingencies due to costs/volatility.

Credit conditions

• Total bank lending (ex-cards) flat—softer than year-ago; follows a slight decline last period.
• CRE & auto loans up modestly; residential mortgages & HELOCs up moderately; other consumer stronger; C&I loans down sharply. Credit cards up slightly (slower than last year).
• Banks report activity uptick (deposits/originations) and a slight rise in NPLs; nonpayment rising beyond low-income tiers.
• Tariffs + tighter standards are disproportionately hurting small businesses’ access to capital.

For more information about District economic conditions, visit: https://www.philadelphiafed.org/regional-economy.

Federal Reserve Bank of Cleveland

Activity inched up; outlook modest. Consumer spending flat on affordability worries; manufacturing flat amid tariff/trade uncertainty; professional & business services up moderately (slower than prior reports). Employment flat, with modest wage pressure and many firms holding pay steady. Non-labor costs strong (tariffs, tech), while selling prices rose modestly.

Overall activity & outlook

• District activity up slightly; firms expect modest gains ahead.
• Consumers flat; manufacturing demand flat (tariff uncertainty); PBS demand up but slower than last three periods.
• Non-labor costs robust; selling prices up modestly.

Labor markets

• Headcounts flat; softer labor demand → hiring via attrition and reduced hours (some mfg).
• Selective hiring where demand grows (e.g., cybersecurity); talent acquisition easier for higher-skill roles.
• Wages modest; nearly 80% holding pay steady. Raises tied to annual cycles; some hospitality firms paused raises on profitability/costs.

Prices

• Input costs strong—widely tied to tariffs (electronics, tools, metals, vehicles, beef) and higher tech/AI/software costs; hospital drug prices up.
• Selling prices: modest increases; pass-through varies (some 100% of tariffs, others slower). Pricing power soft in parts of metals; several firms waiting but expect to raise soon.

Consumer spending

• Flat overall; affordability squeezes lower/middle incomes.
• Autos: some postponing; others buying ahead of tariffs. Most expect no change near term.

Manufacturing

• Little change in orders; tariffs and macro uncertainty weigh.
• Gains where customers reshore or resume postponed purchases; heavy industry softer.
• Expect modest demand increases ahead.

Real estate & construction

• Residential demand up on balance (mixed by builder/market). Rate lock-in deters movers; some buyers waiting for lower mortgages.
• Nonresidential flat: some projects delayed (tariffs/uncertainty); pockets of strength in data centers and industrial upgrades. Outlook: slight rise.

Financial services

• Loan demand up modestly; some firms adjusted to trade policy and resumed expansions.
• Consumers making large purchases ahead of tariffs; near-term softening expected as tariffs hit.
• Banks see modest lending growth ahead.

Nonfinancial services

• PBS demand rose moderately; robust gains expected.
• Accounting buoyed by tax changes.
• Law firms see two paths: transactions if tariffs mild & rates fall; restructuring/bankruptcy if tariffs bite & rates stay high.
• Freight/transport slightly down; expect modest improvement as tariff uncertainty clears.

Community conditions

• Ohio FQHCs warn potential Medicaid cuts would strain budgets, staffing, and access.
• Mitigations: diversify revenue, shift to value-based care, expand commercial credentialing; some contemplate service/staff hour cuts.

For more information about District economic conditions, visit: https://www.clevelandfed.org/en/region/regional-analysis.

Federal Reserve Bank of Richmond

Fifth District growth is modest. Consumers are still spending (retail, leisure travel, auto/motorcycle/boat sales up). Manufacturing down modestly on tariffs, costs, and supply-chain frictions. Most other sectors flat to slightly down. Employment unchanged with small, targeted headcount moves; wages moderate. Price growth picked up a bit in tariff-exposed retail/wholesale, but y/y remains moderate overall.

Overall activity & prices

• District economy grew modestly; non-manufacturing mostly flat/slightly down.
• Prices: Manufacturers’ y/y price gains low-3%; non-manufacturers up from low-3% (Jul) to ~4% (Aug), led by tariff-exposed categories (metals, wood, appliances, imported machinery).

Labor markets

• Employment largely unchanged; firms fine-tuning headcount to demand (some pre-emptive layoffs in mfg).
• Policy/immigration shifts tightened construction labor; hiring plans moderated at some suppliers.
• Wage growth moderate (cost-of-living adjustments noted).

Manufacturing

• Declined modestly; many firms now raising prices after delaying pass-throughs (e.g., compressor maker).
• Tariff policy uncertainty adds admin burden; second-round effects: suppliers lifted prices 5–15% even for firms not importing.
• Supplier exits/consolidation reported (e.g., glass supply chain).

Ports & transportation

• Port volumes slightly down overall (autos/heavy machinery imports an exception); earlier front-loading + high inventories weighed.
• Ag exports down on Chinese retaliation. Ocean rates lower as carriers restored East Coast capacity; Chinese vessel tax prompting route shuffles but limited volume impact.
• Trucking flat, margins thin; one profitable firm sold due to persistent malaise.

Retail, travel & tourism

• Consumer spending up modestly; steady foot traffic, some big-ticket gains (home improvement financed via savings/HELOCs).
• Auto/motorcycle/boat sales up.
• Leisure travel up (drive-to beaches/mountains; sports travel strong); business travel down, notably around greater D.C.

Real estate & construction

• Residential cooled slightly (seasonal): pricing bifurcation (“2021 pricing” vs realistic). Buyers can qualify, but monthly payments bite at current rates; renting often cheaper.
• Builders cite tariffs, zoning, aging workforce, immigration as cost drivers.
• Commercial real estate flat: investors/tenants slowly re-engaging; deals slower and more fragile. Office in “modern turmoil” amid RTO; some obsolete buildings torn down for land value.

Banking & finance

• Loan demand steady, with a slight uptick in mortgages and auto (helped by softer rates and more competition).
• Commercial borrowers cautious, but pipelines steady. Deposits stable; competition easing. Delinquencies stable; borrower credit quality unchanged.

Nonfinancial services

• Demand is stable, but uncertainty is high. Clients show fiscal conservatism, deferring marketing/consulting and growth plans until outlook clears.

For more information about District economic conditions, visit: https://www.richmondfed.org/research/data_analysis.

Federal Reserve Bank of Atlanta

Sixth District edged down. Jobs flat, wage pressure easing; prices up moderately with tariff clauses spreading in contracts. Consumers softer (restaurants/home goods down; online/luxury OK). Leisure travel slowed, business travel flat. Home sales up slightly on incentives and lower values (big price corrections in Florida); CRE slipped with rising vacancies and multifamily oversupply. Transport and manufacturing are down, though ports/intermodal held up. Loans up modestly despite tighter standards. Energy grew modestly (LNG strong; data-center power demand rising).

Overall activity & prices

• District declined slightly since the last report.
• Prices rose moderately; pass-through harder for small firms → cost-cutting, product mix changes, trimmed hours.
• Construction inputs (steel/aluminum/concrete) are higher; labor costs are stabilizing. Many contracts now include tariff clauses; firms expect tariff-driven inflation through H2 ’25 into 2026—even those with little direct exposure.

Labor markets

• Headcount flat; firms favor attrition and are cautious on new hires.
• Plenty of applicants for most roles; technical hiring still challenging.
• Some hiring plans paused amid federal spending pullbacks; immigration-policy concerns persist.
• Wages broadly unchanged.

Community perspectives

• Workforce intermediaries: fewer employer requisitions; small firms shifting to contract labor.
• Food assistance requests up; nonprofits face cash-flow strain from delayed/cut federal funds.
• CDFIs: more owners using personal/high-interest debt to cover costs and pre-buy inventory ahead of tariffs.

Consumer spending & tourism

• Spending softened overall: restaurants/home goods weaker; online & luxury held up.
• Retailers fear further softening as pre-tariff inventory runs out.
• Autos: parts/service up as owners keep cars longer; new sales flat–down.
• Leisure travel down slightly (price-sensitive & international visitors pulled back); discounts couldn’t fill rooms in some markets. Group bookings slower with longer decision cycles; business travel flat. Cautious optimism for fall/holiday.

Construction & real estate

• Home sales up slightly on small rate relief, lower valuations, and builder incentives; Florida saw the sharpest price drops.
• Sellers delisted rather than accept discounts; affordability and credit quality still headwinds.
• CRE down slightly: vacancies rising; Class A, highly amenitized offices steadier as RTO escalates; some office-to-hotel/industrial conversions.
• Industrial sales healthy but vacancies creeping up amid new supply. Multifamily oversupply → deeper rent concessions. Retail softened; small tenants seek rent relief; retail asset sales steady.

Transportation

• Sector down modestly overall.
• Intermodal rail up (share gains, easy comps) but industrial carloads sluggish (chemicals/metals weaker); housing- and auto-related shipments down.
• Southeast ports volumes up y/y.
• Trucking soft in consumer/industrial freight; stronger lanes tied to data centers and alt-energy projects.
• Expect soft peak season amid tariff uncertainty and slowing backdrop.

Manufacturing

• Declined modestly: weaker orders in housewares, beverages, chemicals; exports slowed; backlogs fell.
• Some firms reshoring/switching suppliers; outlook downgraded on costs, tariffs, cautious consumers, and softer global trade.

Banking & finance

• Loan growth up modestly even as standards tightened.
• Construction & consumer lending contracted; other books expanded.
• Capex slowed; credit-line use up (esp. small businesses).
• SBA lending weaker amid federal-program uncertainty.
• Delinquencies/charge-offs low; capital ratios stable.

Energy

• Activity up modestly. LNG production/exports robust.
• Electricity demand rising—led by commercial/industrial (notably data centers).
• Chemicals flat to softer (paper/pulp inputs). Oil output stable, with many expecting a decline by year-end.

For more information about District economic conditions, visit: https://www.atlantafed.org/economy-matters/regional-economics

Federal Reserve Bank of Chicago

Seventh District up modestly. Consumer spending and manufacturing up; employment and business capex up slightly; construction/real estate down slightly. Prices up moderately, wages up modestly; financial conditions loosened slightly. 2025 farm income outlook unchanged (lower crops offset by stronger livestock).

Overall activity & outlook

• Activity increased modestly; contacts expect a slight gain over the next year.
• Nonbusiness contacts: no change.

Labor markets

• Employment up slightly; growth expected to stay modest.
• Mixed conditions: persistent skills shortages (mfg, construction, marketing) vs. easing in other areas (lower attrition, easier hiring).
• Immigration-enforcement fears reduced attendance in nursing/hospitality.
• Wages/benefits up modestly.

Prices

• Moderate increases in producer/consumer prices.
• Nonlabor inputs up (energy, chemicals, aluminum, steel), often tariff-related; some firms passed costs through, others delayed.
• Construction inputs eased in spots recently.
• Some retailers may delay tariff pass-through until early next year.

Consumer spending

• Moderate rise overall.
• Strength: jewelry, landscaping, computers; softer: mattresses, non-computer electronics.
• Longer summer promos.
• Leisure & hospitality up (hotels, restaurants).
• Auto sales up moderately—helped by EV purchases ahead of incentive phase-outs.

Business spending

• Slight increase; capex ticking up from low levels with a slight pickup expected ahead.
• Truck demand flat, freight rates down slightly.
• Mfg inventories a bit high; retailers leaner and cautious; auto inventories down slightly.

Construction & real estate

• Slight decline overall.
• Residential: construction edged down; upgrades/renovations stronger than new SF builds. Multifamily timelines slipped (permits/rezoning); absorption slower and rents down in that subsector.
• Nonresidential: slightly up—subsidized/tax-abated projects and data centers robust; more pre-ordering to manage costs.
• CRE demand unchanged; rents up, vacancies flat; strong interest in top-tier office and warehouse space.

Manufacturing

• Modest increase.
• Steel up (energy demand); fab metals up (energy & construction); machinery up (aerospace, oil).
• Some pull-forward to avoid tariffs.
• Auto production up slightly; heavy trucks flat.

Banking & finance

• Financial conditions loosened slightly (bonds up a bit, equities up modestly, vol down).
• Business loan demand up slightly; some revival in M&A as policy sensitivity eases; others still hesitant.
• Business loan quality down slightly; rates down modestly; terms flat.
• Consumer loans up slightly (mortgage activity noted); quality down slightly; rates flat; terms tightened slightly.

Agriculture

• Farm income prospects unchanged: lower crop revenues offset by stronger livestock.
• Corn prices down (record yield forecasts); soybeans up (fewer planted acres, but record yields forecast).
• Disease risk a concern; soy export uncertainty persists.
• Cattle prices at historic highs; dairy mixed; eggs down; hogs flat.
• Farm machinery sales lackluster; fertilizer tariffs raise cost concerns for 2026 financing.

Community conditions

• Activity steady but policy uncertainty elevated.
• One state saw overall tax revenues down, sales tax up.
• Small businesses reshoring/adjusting suppliers to manage tariffs.
• Nonprofits face funding uncertainty; leaning on local support amid back-to-school costs for low-income families.

For more information about District economic conditions visit: https://chicagofed.org/cfsec.

Federal Reserve Bank of St. Louis

Overall unchanged activity and employment. Wages/labor costs up moderately and faster than prior periods (immigration-related shortages cited). Prices up moderately with faster momentum and expectations for quicker increases ahead (tariffs, margin rebuild). Outlook slightly pessimistic, but no longer worsening.

Overall activity & prices

• Activity flat; uncertainty high (tariffs, policy).
• Prices: moderate but accelerating; many testing pass-through after absorbing costs earlier; some warn of consumer pushback.

Labor markets

• Headcounts flat; hiring on hold at many firms pending policy clarity; some proceed without cuts.
• Shortages persist in manufacturing, construction, agriculture—attributed to lost immigrant labor; turnover elevated.
• Wages up more than prior reports (examples: +5.5% at a rec. business; +8–10% in agribusiness), driven by H-2A rates, minimum-wage bumps, COL, and retention.

Consumer spending

• Mixed retail: some beats, some shortfalls; day-to-day volatility high.
• Autos mixed—pull-forward buying vs. affordability and tight used supply.
• Leisure/hospitality down; business travel showing slight improvement.

Manufacturing

• Flat vs. prior quarter and year; many below plan.
• Steel flat; beverages export hit by retaliation; food processing −4% volumes with further declines expected.
• Select firms shifting strategy (e.g., acquiring distressed assets) after pausing capex.

Nonfinancial services

• Generally unchanged; transport slightly lower; healthcare mixed.
• Auto repair strong (older vehicles kept longer).
• Staffing demand down as firms cut costs; professional services softer on fewer construction projects but expect improvement.

Real estate & construction

• Residential: overall unchanged; listings/sales up slightly y/y but market slow; new builds lingering → discounts; high-end sits longer.
• Commercial: unchanged—existing projects progress, few new starts (rates/costs/uncertainty). Retail space demand in TN holding up after spring pause.

Banking & finance

• Overall activity unchanged; loan demand slightly better than expected; outlook for ’25 moderate growth.
• Credit quality solid but delinquencies edging up; banks cautious/selective, wary of consumer risk and slowing CRE pipelines.

Agriculture & natural resources

• Strained but stable: major row-crop prices below breakeven; some plan to store soybeans amid weak demand.
• Equipment payment defaults rising; more farm failures likely, though land values seen resilient.
• Cattle profits strong, but no expansion (high costs/uncertainty).

Visit our Regional Economic Data and Reports page for more information about District economic conditions.

Federal Reserve Bank of Minneapolis

Ninth District down slightly. Employment edged lower with softer labor demand; wage growth moderate but easing. Prices up modestly. Consumer spending softened (more price sensitivity). Construction flat; real estate mostly flat with mixed local trends. Manufacturing contracted slightly; ag conditions weak (good yields, poor prices). MWBE activity declined.

Overall activity & outlook

• District activity slipped slightly since the last report.
• Businesses show caution amid uncertainty; some delay hiring and projects.

Labor markets

• Headcounts down slightly; openings/hiring sentiment softened; some firms leaving vacancies unfilled.
• Layoffs low; labor availability improved (over-skilled applicants reported).
• Staffing firms saw two months of rising industrial placements but unsure if it signals demand or reluctance to hire directly.
• Wages: modest–moderate and easing; notable union gains but some firms offset costs (e.g., lower rates for new hires, no bonuses).

Prices

• Modest price increases overall; about ¼ of firms raised prices in July; ½ saw higher inputs.
• Margin pressure building: competition limits pass-through in some goods; suppliers warning of more hikes ahead.
• Retail fuel prices down slightly.

Worker experience

• Job search conditions worsened for many white-collar roles (software, media/creative, managers, biz/finance).
• Physical/service roles (cooks, servers, landscapers, stylists) still hiring, but overall opportunities narrowing.
• AI tools both barrier (screening) and aid (resume prep, mock interviews).

Consumer spending & tourism

• Retail sales/foot traffic slower; higher price sensitivity (discounts needed to convert).
• International (especially Canada) travel subdued; national park visits modestly lower y/y.
• Hotel occupancy down in Dakotas/Montana, up in MN/WI; RevPAR mixed.
• Auto: overall flat—new vehicles strong, used down; parts/maintenance spend up as people keep cars longer.

Construction & real estate

• Construction flat; top challenges: rates, materials, policy. Skilled labor still tight; modest expected employment growth.
• Permits up y/y modestly, led by residential (notably Rochester MN, Rapid City SD, Billings MT).
• Commercial real estate flat; high rates/uncertainty dampen new builds, benefiting existing owners.
• Residential slightly higher overall but mixed by market (MT & N. WI up; Fargo/Sioux Falls flat; MSP/western WI down; rest of MN up).

Manufacturing

• Slight contraction: more firms report lower orders than higher; few steady.
• State indexes mixed (MN/SD down; ND up).
• Dollar sales supported by price increases, but physical volumes down.

Agriculture, energy & natural resources

• Ag weak: strong yield prospects but prices at/below breakeven; tariff risk lifting fertilizer costs.
• Oil & gas exploration steady; production up slightly.

Minority- & women-owned businesses (MWBE)

• Activity declined, with expectations for further deceleration.
• Demand uneven (auto repair up as drivers maintain used vehicles longer).
• Employment and labor demand down; compensation and input cost pressures persist.

For more information about District economic conditions visit: https://www.minneapolisfed.org/region-and-community

Federal Reserve Bank of Kansas City

Tenth District flat overall. Employment down modestly; wage pressures subdued but non-wage benefits lifting total labor costs. Prices up moderately with broad input cost creep (tariffs + sticky supplier pricing) → margin compression. Consumer spending steady but trading down. Manufacturing/consumer services up slightly; professional services softer. CRE steady; bank credit quality mostly sound. Energy ticked up. Ag worsened slightly (weak crop profits; cattle prices firmer).

Labor markets

• Headcounts fell modestly (services & manufacturing); hiring plans softer ahead.
• Wages modest; firms expect subdued wage growth, but benefit costs rising faster → higher total labor costs.
• Mixed grad placements: some STEM grads face a weaker job market.