The Federal Reserve’s latest Beige Book, released on July 16, 2025, paints a cautious picture of the U.S. economy, highlighting flat or weakening activity across most of its 12 districts. Compiled by the Federal Reserve Bank of Boston from data collected before July 7, the report draws on insights from business leaders, economists, and market experts. While overall business conditions remain stable and inflationary pressures are relatively contained, underlying concerns about future growth are casting a shadow over the economic outlook.
From late May to early June, economic activity showed only a slight uptick, with most districts reporting stagnant or slightly declining conditions. The report notes a neutral to mildly pessimistic outlook, with only two districts anticipating growth, while the rest brace for flat or weaker performance. This cautious sentiment reflects growing unease among business operators, who are grappling with uncertainties despite a broadly healthy economic backdrop.
Inflation remains a mixed story, with prices rising across all districts. Seven districts reported moderate price increases, while five described growth as modest, largely in line with the previous report. Although inflationary pressures are subdued compared to recent years, the gradual buildup of costs continues to weigh on businesses, contributing to the guarded outlook. As the Federal Reserve navigates these signals, the Beige Book underscores a critical juncture for monetary policy, with markets and policymakers closely watching for signs of how these trends will shape future rate decisions.
