By Yasin Ebrahim
Investing.com - The U.S. economy continued to come under pressure from supply chain disruptions, labor shortages, and inflation but businesses were able to hike prices to offset price pressures amid strong consumer demand, according to the Federal Reserve's Beige Book released Wednesday.
"Economic activity grew at a modest to moderate pace in most Federal Reserve Districts during October and early November,"the Fed said in its Beige Book economic report, based on anecdotal information collected by the Fed’s 12 reserve banks through Nov. 23. "[G]rowth was constrained by supply chain disruptions and labor shortages."
The robust demand for labor continued to outstrip supply, driven by "ongoing Covid concerns, child care, and a reduced urgency to work due to fiscal support and accumulated savings."
Inflation, which continued its moderate to robust pace, showed little sign of slowing but the backdrop of strong consumer demand "generally allowed firms to raise prices with little pushback...," the reported added.
Federal Reserve Chairman Jerome Powell made a surprise admission this week after he conceded that elevated inflation could persistent for longer than initially expected.
“The point is, we can't act as if we're sure of that," Powell said in his second day of testimony on Capitol Hill. "We’re not at all sure of that. Inflation has been more persistent and higher than we’ve expected."