Economic activity rising and inflation easing slightly, Fed survey shows

• Federal Reserve policymakers preparing for their next policy meeting in two weeks got a fresh snapshot on Wednesday of a broadly improving economy. Employment is on the rise but not straining wage bills, and inflation is easing slightly but still delivering an unwelcome sting.
• "Compared with the last reporting period, price growth was the same or slower in all districts," it said. "Expectations for price growth over the coming months varied across districts, with contacts in some expecting inflation to continue at its current pace, while contacts in others expected inflation to slow, in part due to falling fuel prices."
• Elevated inflation pushed about half of the policymakers at the Fed's June 16-17 meeting to project at least one rate hike by the end of 2026. Kevin Warsh has been silent about his own rate-path view, even as he repeatedly promised to restore price stability and said the central bank has the tools to do so — a commitment he reiterated in back-to-back appearances before lawmakers in Congress on Tuesday and Wednesday.
• A drop in fuel prices last month due to a preliminary peace agreement between the U.S. and Iran helped cool inflation, data this week showed, but renewed hostilities this month have pushed oil prices back up and reignited inflation concerns.
• The labour market is not contributing to inflation, the report suggested — a point that Fed policymakers have also made. But non-labour input costs continue to rise, the report found, across "a variety of industries — including services, construction, and manufacturing — and reflected, in part, higher costs for energy, transportation, and raw materials."

(Sources: Reuters)