Economic activity up slightly to fairly in 12 US districts in Nov, Dec

Consumer spending moved up moderately, with most districts reporting strong holiday sales that exceeded expectations.

Manufacturing decreased slightly on net, and a number of districts said manufacturers were stockpiling inventories in anticipation of higher tariffs.

Commercial real estate sales edged up. Truck freight volumes, however, were down.

Agricultural conditions remained weak overall, with generally lower farm incomes and weather-related struggles in some areas. Energy activity was mixed.

More contacts were optimistic about the outlook for 2025 than were pessimistic about it, though contacts in several districts expressed concerns that changes in immigration and tariff policy could negatively affect the economy.

Employment ticked up on balance, with six districts reporting a slight increase and six reporting no change.

Manufacturing employment was flat. Contacts across multiple sectors noted difficulty finding skilled workers, and reports of layoffs remained rare. However, contacts in some districts expressed greater uncertainty about their future staffing needs.

Wage growth picked up to a moderate pace in most districts, though there were some reports that wage pressures had eased.

Prices increased modestly overall, with growth rates ranging from flat to moderate. Contacts in most districts reported modest increases in selling prices, though there were instances of flat or decreasing prices as well, particularly in the retail and manufacturing sectors.

Input costs also rose. However, as with selling prices, there were several mentions of flat or lower input costs, particularly for fuel. Contacts expected prices to continue to rise in 2025, with some noting the potential for higher tariffs to contribute to price increases, a Fed release said.

ALCHEMPro News Desk (DS)