U.S. Fed reports tight labor market but modest wage growth

Source: Xinhua| 2018-01-18 04:46:06|Editor: yan
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WASHINGTON, Jan. 17 (Xinhua) -- U.S. economy continued modest to moderate growth pace in late November through the start of 2018, with tight labor market but modest wage growth, according to a Federal Reserve survey released on Wednesday.

Eleven of the Fed's 12 regional districts reported "modest to moderate" economic gains, while the Dallas Fed district saw "a robust increase", said the Fed in its latest survey on economic conditions, known as the Beige Book, based on information collected through Jan. 8.

"The outlook for 2018 remains optimistic for a majority of contacts across the country," the report said, noting most manufacturers reported modest growth in overall business conditions.

While most districts reported on-going labor market tightness and challenges finding qualified workers across skills and sectors, wages still increased "at a modest pace", according to the report.

Several districts also noted increases in manufacturing, construction, or transportation input costs, but firms in some districts said they have the ability to increase their selling prices, the report said.

Wednesday's report comes before the Fed's next policy meeting on Jan. 30-31. Analysts said the central bank would leave its benchmark interest rates unchanged at this meeting as U.S. inflation remains subdued.

The Fed's preferred measure for inflation, after excluding volatile food and energy components, was only 1.5 percent in the 12 months through November, still below the Fed's 2 percent target.