By James Clary
Wednesday Oct 20th saw the publishing of the latest edition of the Federal Reserve’s Beige Book, more formally called the Summary of Commentary on Current Economic Conditions. This book collects information from a variety of Federal Reserve sources including business contacts and economics, using this data to outline the economic conditions of the nation and the twelve individual Federal Reserve Districts (Hampton Roads is in the Fifth District based in Richmond). Economic research has found that the Beige Book significant predictive content as well as information about the current real GDP growth not found in other sources, including the Blue Chip Consensus Forecast.
The Fed’s Beige Book should that the U.S. economy continued to grow between September in October, but at a modest pace, and that retailers have indicated that consumers remain price conscious, “largely limiting themselves to purchases of necessities and nondiscretionary items.” It also notes that both the housing market and the commercial real estate market remain subdued.
The Richmond Fed noted that Port Activity in the 5th district (which includes Baltimore, Charleston, and the Port of Virginia) remains mixed, with imports outperforming exports. Further, it noted that shipping rates are down, but the capacity utilization has rebounded, which should allow shippers to begin exerting some pricing power. Additionally, the Richmond Fed mentioned that the Housing market is weak in Eastern Virginia, with the number of homes under contract down 20%, while the number of active listings has increased by 10%.