The US Federal Reserve (Fed) published the January 2021 issue of the “Beige Book” report, which includes evaluations of the current situation in the American economy. In the report, prepared with analysis from 12 branches of the bank, it was stated that most Fed branches reported a slight increase in economic activity since the previous Beige Book report was published in December 2020.
Increasing cases reduce optimism
In the report, it was noted that reporting on consumer spending followed a mixed course, and some branches reported that demand for retail sales, entertainment and accommodation services decreased due to the increase in COVID-19 cases and the tightening of measures.
In the report, which pointed out that online sales have intensified during the holiday season last month, it was stated that automobile sales have weakened slightly, and activity in the energy sector has increased for the first time since the beginning of the epidemic. In the report, it was reported that production activities continue to recover in almost all regions despite difficulties in the supply chain.
“While the prospect for COVID-19 vaccines supports optimism for growth in 2021, this optimism has been mitigated by concerns about the recent resurgence of the virus and its effects on short-term business conditions,” the Fed’s report said. was evaluated.
Layoffs have resumed in the entertainment industry
The report pointed out that most of the regions reported an increase in employment, albeit slowly, and a growing number of regions experienced a decrease in employment levels compared to the previous reporting period.
The report emphasized that the demand for labor is strong in the manufacturing, construction and transportation sectors, and pointed out that some employers have difficulties in finding qualified workers, especially for beginner and field positions, and lack of personnel.
It was noted that the difficulty in employment has worsened in some regions with the increase of COVID-19 cases, and the dismissals in the entertainment and accommodation sectors have resumed with the tightening of the measures.
The analysis in Beige Book is taken into account by the Federal Open Market Committee (FOMC), which determines the Fed’s monetary policies. The next meeting of the FOMC is scheduled for January 26-27.
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