MNI BRIEF: U.S. Economy Has Picked Up, Fed's Beige Book Says

The U.S. economy "accelerated to a moderate pace" from late February to early April, according to the Federal Reserve's Beige Book published Wednesday.

"Consumer spending strengthened. Reports on tourism were more upbeat, bolstered by a pickup in demand for leisure activities and travel which contacts attributed to spring break, an easing of pandemic-related restrictions, increased vaccinations, and recent stimulus payments among other factors," the report said. "Auto sales grew, even as new-vehicle inventories remained constrained by microchip shortages."

Fed officials are assessing the inflationary potential of a better-than-expected recovery coupled with highly supportive monetary and fiscal policies. Most on the committee believe powerful disinflationary forces are still at play given ample labor market slack, as Richmond Fed President Thomas Barkin recently told MNI.

Still, Fed Chair Powell reiterated earlier Wednesday he believes the U.S. economy is entering a stronger growth phase as the Covid pandemic ebbs.