US: Beige Book in focus today – Nomura

Analysts at Nomura explain that to prepare for policy discussions at the May FOMC meeting, the Federal Reserve Board publishes its Beige Book on Wednesday, containing anecdotal evidence from each of the 12 Fed districts.

Key Quotes

“This information is collected from a variety of sources within each district, including local business leaders and market experts. We expect this issue to shed some light on the continued divergence between hard and soft economic data since the election. The increase in sentiment indices has somewhat leveled off and the Beige Book might provide more insight into how long this divergence may last. In particular, it will be interesting to see if the failure to repeal the Affordable Care Act (ACA) has affected business sentiment as respondents’ expectations on the new administration’s policy agenda may have tempered somewhat since the last Beige Book. Additionally, the industry-specific sections could provide more color on the regional distribution of strength in manufacturing employment over the last few months.”