There had been an expectation Fed officials could announce plans to start reducing the central bank’s $120 billion monthly bond purchases, which are being made to help lower long-term interest rate…
U.S. economic activity “downshifted” in July and August due to rising concerns about COVID’s delta variant, as well as supply chain problems and labor shortages, the Federal Reserve’s latest survey of the nation’s business conditions revealed. The Fed survey, released Wednesday, said the slowdown was largely attributable to a pullback in dining out, travel and tourism in most parts of the country, reflecting concerns about the spread of the delta variant. The Fed also said some sectors of the economy had been constrained by supply chain disruptions and labor shortages. It noted particular weakness in auto sales attributed to low inventories caused by a shortage of computer chips. “Economic growth downshifted slightly to a moderate pace in early July through August,” the report, known as the Beige Book, said. It was based on interviews done by the Fed’s 12 regional banks and completed by Aug.30. It will be used in discussions when Fed officials hold their next interest rate meeting on Sept.21-22. There had been an expectation that Fed officials could announce at this month’s meeting plans to start reducing the central bank’s $120 billion monthly bond purchases, which are being made to help lower long-term interest rates.
