Bitunix Analyst:Beige Book Sends aKey Signal—Growth Is Stabilizing,but Inflation Risks Are Building Beneath the Surface

BlockBeats News, January 15, The latest Federal Reserve Beige Book shows that since mid-November, economic activity across most U.S. districts has rebounded at a “slight to moderate” pace, marking a clear improvement from previous reporting periods. However, labor-market momentum remains soft: eight of the twelve districts reported little to no employment growth, while wage increases have cooled back to “normal, modest” levels—suggesting a slowing but orderly labor market.

More importantly, the source of inflation pressure is shifting structurally. The Beige Book notes that as pre-tariff inventories are gradually depleted, firms are finding it increasingly difficult to absorb higher costs internally and are beginning to pass tariff-related expenses on to end consumers. Districts such as New York and Minneapolis report that rising prices are already squeezing profit margins, with particularly sharp increases in service-sector costs, including healthcare and insurance.

This aligns with recent messaging from several Fed officials: the economy has not entered recession and employment remains resilient, but the disinflation path is far from smooth. With tariffs and policy uncertainty adding friction, the pace of rate cuts is unlikely to move forward. Markets now broadly expect that the Fed may not adjust rates again until mid-year at the earliest.

Bitunix Analyst View:

The Beige Book’s key takeaway is not “stronger growth,” but “inflation pressure being pushed downstream.” Once higher costs fully feed into PPI and CPI, the Fed’s policy flexibility will narrow again. This dynamic is a central reason why global markets continue to scale back aggressive easing expectations.