Fed’s Beige Book: U.S. Economy Declined Slightly, Casting Doubt on Fed Interest Rate PolicyJohn Carney 4 Jun 2025
The U.S. economy has declined slightly and unevenly amid recent financial market volatility and on-and-off-again tariff policies.
Six of the twelve Federal Reserve districts reported slight to moderate declines in activity, three saw no change, and the remaining three noted slight growth, according to the Federal Reserve’s Beige Book released Wednesday. Taken as a whole, economic activity in the United States declined slightly in recent weeks, the Fed’s report said.
While business sentiment remains cautious and uncertainty—particularly surrounding trade policy—continues to weigh on decision-making, the report also highlights areas of stability and adaptation. Companies across several sectors are adjusting supply chains, slowing capital expenditures, and in some cases shifting production back to the U.S. in response to rising tariffs.
“All districts reported elevated levels of economic and policy uncertainty, which has led to hesitancy and a cautious approach to business and household decisions,” the report said.
The report could support President Donald Trump’s claims that the Fed is behind the curve on interest rates and should have already started cutting. On Wednesday morning, President Trump reacted to a report showing fewer than expected private sector jobs by once again calling on Fed chairman Jerome Powell to reduce interest rates.
The Fed cut interest rates three times at the end of last year but stopped cutting as Trump took office this year, despite broadening concerns over an economic slowdown and positive news on inflation.
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https://www.breitbart.com/economy/2025/06/04/feds-beige-book-u-s-economy-declined-slightly-casting-doubt-on-fed-interest-rate-policy/
