US continues mediocre growth, 2020 outlook is ‘modestly favourable'
WASHINGTON The US economy showed less-than-stellar growth in the final weeks of last year but produced solid holiday sales and enters this year with a "modestly favourable" outlook, the Federal Reserve said.
On the day the US and China signed a long-awaited partial trade truce after months of conflict, the Fed said tariffs continued to weigh on the economy in some regions.
"In many districts, tariffs and trade uncertainty continued to weigh on some businesses," the report said.
However, "expectations for the near-term outlook remained modestly favourable across the nation".
In the Philadelphia region, the looming tariffs on European wine "prompted an area merchant to stock up with over 35,000 cases" to beat the sanctions and minimise price hikes, according to the report. Overall economic growth in the area "slowed to a slight pace".
Across the US, "holiday sales were said to be solid" in the crucial annual shopping period, while tourism was "mixed" and manufacturing - a sector hit badly by the trade wars - was "essentially flat" in most areas.
Labour remained scarce, with employers struggling to fill open positions, a trend that now dates back more than a year.
But in the manufacturing, transportation and energy sectors, there were job cuts and reduced hiring.
The report was prepared in advance of the Fed's next policy meeting on Jan 28 to 29. Markets largely expect policymakers to leave interest rates untouched until November. - AFP