Fed's Beige Book: Central bank on 'wait and see' mode

Economic Activity & Outlook - Economic activity increased slightly from late May through early July [1] - Five districts reported slight or modest gains, while two noted a modest decline [2] - Overall outlook was neutral to slightly pessimistic, with uncertainty remaining elevated [2] Labor Market - Employment increased very slightly overall, with cautious hiring attributed to economic and policy uncertainty [3] - Many expect to postpone major hiring and layoff decisions until uncertainty diminishes [3] - Layoffs were limited overall, but somewhat more common among manufacturers [4] Inflation & Costs - Prices increased across districts moderately or modestly, similar to the previous report [4] - Businesses reported modest to pronounced input cost pressures related to tariffs in all 12 districts [4] - Cost pressures are expected to remain elevated, increasing the likelihood of faster consumer price increases by year-end [6] - Many firms passed on cost increases to consumers through price hikes or surcharges, while some held off due to price sensitivity [5] - Raw material costs, especially for manufacturing and construction, were impacted by tariffs [5]