A Federal Reserve survey of business conditions around the country found that economic activity in several regions slowed in November as coronavirus cases surged.
The Fed report released today said that overall, the Fed’s 12 regional banks characterized the economic expansion as “modest or moderate.” But it noted that three Midwest regions and the Philadelphia region reported activity had begun to cool in early November as COVID-19 cases surged.
The report said that most districts found that local businesses’ optimism has “waned,” with many citing concerns about the wave of virus cases and renewed lockdown restrictions.
The report, known as the beige book, will be used by Fed officials when they hold their last meeting of the year on Dec. 15-16 to discuss possible changes to the central bank’s interest-rate policies. The Fed is expected to maintain its ultra-low interest rates over the next three years. But it may also decide as soon as this month’s meeting to expand the support it is providing through its bond purchases, especially if Congress is unable to pass further economic relief legislation in the lame-duck session.
At a congressional hearing Wednesday, Fed Chairman Jerome Powell said that increased support from Congress is needed as a bridge between the current economic troubles and the time next year when a virus vaccine is expected to be widely available.
At the same time, top Democratic congressional leaders embraced today the $908 billion coronavirus relief framework, backed by a bicameral, bipartisan group of lawmakers including U.S. Sen. Bill Cassidy—a massive concession meant to prod President Donald Trump and Senate Republicans into accepting a compromise as COVID-19 cases spike and the economic recovery shows signs of faltering ahead of the holiday.
According to The Washington Post, House Speaker Nancy Pelosi and Senate Minority Leader Charles E. Schumer said in a statement that “we believe the bipartisan framework introduced by Senators yesterday should be used as the basis for immediate bipartisan, bicameral negotiations.”
Read the full story about the Federal Reserve survey here, and the coronavirus relief legislation here.
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