Economic activity up slightly, but more areas report declines; consumer spending ‘dampened by uncertainty’

While economic activity increased slightly in seven of 12 Federal Reserve Districts in the last month, it fell or was flat in the remaining five – up from four in the previous reporting period, the agency said Wednesday.

In its Beige Book for February, the Fed also said reported that consumer spending was up slightly overall, but two districts reported ongoing decline. Many districts, the Fed said, noted that sales “were dampened by economic uncertainty, increased price sensitivity, and lower-income consumers pulling back on spending.”

Recent winter storms in the East, and immigration enforcement, have also influenced economic activity, the reported indicated. “Districts impacted by winter storms said that retail traffic generally slowed, and one District said immigration enforcement activity negatively affected customer demand in urban areas,” the Fed said

Affordability issues, the report found, are also at play: “Auto sales were mostly down for Districts that reported on them, with many citing continuing affordability issues,” the report stated.

The Beige Book is a semi-monthly report (published eight times a year) that provides anecdotal information on current economic conditions from each Federal Reserve Bank district through reports from bank and branch directors and interviews with key business contacts, economists, market experts, and other sources.

Also noted in the February report:

• Financial services activity was reported as stable to increased, with commercial lending the strongest.
• Most districts that reported on residential real estate and construction said that sales and activity decreased slightly, with low inventories and affordability remaining key issues.
• Nonresidential construction activity was mixed across reporting districts but increased slightly on net.
• Manufacturing activity improved overall, as eight districts reported varying degrees of growth but two reporting declines.
• Manufacturing contacts reported increases in new orders, and several cited boosts in demand from data centers and, relatedly, energy infrastructure.

Beige Book – February 2026