Fed Beige Book: Caught Between War and Tariffs, Many US Companies Adopt a Wait-and-See Approach
The US Fed's Beige Book reports that businesses are adopting a cautious stance due to Trump tariffs and energy price spikes from the US-Iran war, amid persistent inflation and stable but changing labor markets.
📋 Article Processing Timeline
- 📰 Published: April 16, 2026 at 09:27
- 🔍 Collected: April 16, 2026 at 09:31 (3 min after Published)
- 🤖 AI Analyzed: April 19, 2026 at 11:00 (73h 28m after Collected)
Major News on the US-Iran War
Central News Agency
(CNA, Washington, 15th, Comprehensive Foreign Wire) The US Federal Reserve reported today that as US businesses and households are still adapting to Trump's tariff policies, they are also being hit by surging energy prices caused by the Iran war, leading many companies to take a wait-and-see approach. However, the report noted an increase in economic activity in most parts of the country in recent weeks, with employment remaining stable.
According to Reuters, the Fed noted in its latest 'Beige Book' report that 'the conflict in the Middle East is viewed as a major source of uncertainty, complicating decisions on hiring, pricing, and capital investment, with many companies taking a wait-and-see approach.'
The report stated: 'Amid future uncertainty, business outlooks are mixed.'
Despite the war, contacts in the Boston and St. Louis Federal Reserve districts expressed some optimism, while a more pessimistic mood prevailed in other regions.
A contact at the Federal Reserve Bank of Kansas City stated that low- and moderate-income households 'cannot offset the pressures of low wages, tariffs, and inflation simply by budgeting carefully.'
The market expects the Federal Reserve to maintain its benchmark overnight interest rate in the current 3.50% to 3.75% range at its April 28-29 meeting, with policymakers also taking a wait-and-see approach.
The report indicated that overall price increases 'remained generally modest.' The 'Beige Book' is compiled based on surveys and interviews with business leaders and community organizations across the 12 Federal Reserve districts nationwide.
The data in this report is as of April 6, reflecting the unstable economic situation following Iran's blockade of the Strait of Hormuz. Consequently, the average price of gasoline in the US has risen to over $4 per gallon, retail diesel exceeds $5.60 per gallon, and fertilizer prices have also surged significantly.
Policymakers and analysts were previously surprised by the resilience of consumer spending after the post-pandemic inflation surge and last year's tariff shocks, but the latest report shows signs of this resilience waning.
Manufacturers in the New York Federal Reserve district pointed out that uncertainties from tariff changes and the war 'are disrupting pricing plans and making customers more hesitant to place orders.' However, the New York Fed stated that despite facing headwinds, 'some companies are still showing strong momentum.'
Fed officials state they typically 'look through' short-term fluctuations in commodity prices, and many still expect the inflationary pressures from last year's tariffs to ease later this year, which could create room for another rate cut.
However, inflation has remained above the Fed's 2% target for over five consecutive years. Latest data shows that not only did overall inflation rise in March, but 'core inflation,' which strips out energy and food prices—a key indicator for policymakers assessing future inflationary pressures—may also rise.
Policymakers generally believe the US labor market is stabilizing. A shrinking labor force due to a significant decrease in immigration is balanced by slowing job growth. The US unemployment rate edged down to 4.3% in March.
According to the Beige Book report, overall wage competition remains 'modest,' indicating the labor market is not further pushing up inflation pressures. Several Fed districts also mentioned that layoffs are not widespread and turnover rates are low, showing that a labor market characterized by low layoffs and low hiring remains the norm for most districts.
Furthermore, Artificial Intelligence (AI) continues to alter the employment landscape.
The Federal Reserve Bank of San Francisco noted, 'Some contacts mentioned they are using generative AI tools to reduce costs and have paused new hiring.' (Translation: Xu Ruicheng) 1150416
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Central News Agency
(CNA, Washington, 15th, Comprehensive Foreign Wire) The US Federal Reserve reported today that as US businesses and households are still adapting to Trump's tariff policies, they are also being hit by surging energy prices caused by the Iran war, leading many companies to take a wait-and-see approach. However, the report noted an increase in economic activity in most parts of the country in recent weeks, with employment remaining stable.
According to Reuters, the Fed noted in its latest 'Beige Book' report that 'the conflict in the Middle East is viewed as a major source of uncertainty, complicating decisions on hiring, pricing, and capital investment, with many companies taking a wait-and-see approach.'
The report stated: 'Amid future uncertainty, business outlooks are mixed.'
Despite the war, contacts in the Boston and St. Louis Federal Reserve districts expressed some optimism, while a more pessimistic mood prevailed in other regions.
A contact at the Federal Reserve Bank of Kansas City stated that low- and moderate-income households 'cannot offset the pressures of low wages, tariffs, and inflation simply by budgeting carefully.'
The market expects the Federal Reserve to maintain its benchmark overnight interest rate in the current 3.50% to 3.75% range at its April 28-29 meeting, with policymakers also taking a wait-and-see approach.
The report indicated that overall price increases 'remained generally modest.' The 'Beige Book' is compiled based on surveys and interviews with business leaders and community organizations across the 12 Federal Reserve districts nationwide.
The data in this report is as of April 6, reflecting the unstable economic situation following Iran's blockade of the Strait of Hormuz. Consequently, the average price of gasoline in the US has risen to over $4 per gallon, retail diesel exceeds $5.60 per gallon, and fertilizer prices have also surged significantly.
Policymakers and analysts were previously surprised by the resilience of consumer spending after the post-pandemic inflation surge and last year's tariff shocks, but the latest report shows signs of this resilience waning.
Manufacturers in the New York Federal Reserve district pointed out that uncertainties from tariff changes and the war 'are disrupting pricing plans and making customers more hesitant to place orders.' However, the New York Fed stated that despite facing headwinds, 'some companies are still showing strong momentum.'
Fed officials state they typically 'look through' short-term fluctuations in commodity prices, and many still expect the inflationary pressures from last year's tariffs to ease later this year, which could create room for another rate cut.
However, inflation has remained above the Fed's 2% target for over five consecutive years. Latest data shows that not only did overall inflation rise in March, but 'core inflation,' which strips out energy and food prices—a key indicator for policymakers assessing future inflationary pressures—may also rise.
Policymakers generally believe the US labor market is stabilizing. A shrinking labor force due to a significant decrease in immigration is balanced by slowing job growth. The US unemployment rate edged down to 4.3% in March.
According to the Beige Book report, overall wage competition remains 'modest,' indicating the labor market is not further pushing up inflation pressures. Several Fed districts also mentioned that layoffs are not widespread and turnover rates are low, showing that a labor market characterized by low layoffs and low hiring remains the norm for most districts.
Furthermore, Artificial Intelligence (AI) continues to alter the employment landscape.
The Federal Reserve Bank of San Francisco noted, 'Some contacts mentioned they are using generative AI tools to reduce costs and have paused new hiring.' (Translation: Xu Ruicheng) 1150416
Choose to stand with facts. Every sponsorship from you is the power to protect press freedom.
Download the CNA 'First Hand News' APP to grasp the latest news instantly.
The text, images, audio, and video on this website may not be reproduced, publicly broadcast, publicly transmitted, or utilized without authorization.