EconomyxAI · Beige Book Sector Monitor April 2025Released April 23, 2025 · Data through April 14 |
| |
Conditions index −0.07 avg of 11 sectors, −2 to +2 |
| Outlook index −0.50 sectors with an outlook |
| Districts growing 5/12 per National Summary |
| Positive momentum 1/11 sectors improving |
|
|
This release in brief The read | ■ | Activity was little changed, with five districts growing slightly, three flat and four declining. | | ■ | Tariff uncertainty was pervasive: consumers rushed to buy cars and some goods ahead of price increases while travel, especially from Canada, fell. | | ■ | Outlooks worsened considerably: San Francisco's materially, New York and Kansas City expect declines, and firms paused hiring and capital spending. | | ■ | Price growth stayed modest to moderate, but firms received supplier increase notices and expect to pass tariff costs through; Kansas City price expectations rose robustly. | | ■ | Financial conditions tightened (Chicago, Kansas City, Dallas, Atlanta) and loan growth slowed sharply in Dallas. |
|
Sector prospects Where the 3–12 month view points Strongest prospects Utilities
XLU
▶ Steady | +0.02 |
| Information Technology
XLK
▶ Steady | −0.08 |
| Consumer Staples
XLP
▶ Steady | −0.11 |
|
|
| Weakest prospects Consumer Discretionary
XLY
▶ Steady | −0.76 |
| Industrials
XLI
▼ Turning down | −0.52 |
| Financials
XLF
▼ Weakening | −0.37 |
|
|
|
|
All 11 GICS sectors, ranked Sector scoreboard | # | Sector | −1 0 +1 | Score | Signal | Now | Outlook | Mom. |
|---|
| 1 | Utilities
XLU | | +0.02 | Neutral | +0.13 | n/a | ▶ +0.00 | | 2 | Information Technology
XLK | | −0.08 | Neutral | +0.07 | +0.56 | ▶ −0.15 | | 3 | Consumer Staples
XLP | | −0.11 | Neutral | +0.05 | n/a | ▶ −0.12 | | 4 | Energy
XLE | | −0.12 | Neutral | +0.61 | −0.74 | ▶ +0.38 | | 5 | Materials
XLB | | −0.13 | Neutral | −0.28 | n/a | ▼ −0.25 | | 6 | Health Care
XLV | | −0.15 | Neutral | −0.07 | n/a | ▶ −0.25 | | 7 | Communication Services
XLC | | −0.17 | Leaning Unfavorable | −0.15 | n/a | ▶ −0.12 | | 8 | Real Estate
XLRE | | −0.34 | Leaning Unfavorable | −0.06 | −0.60 | ▶ −0.10 | | 9 | Financials
XLF | | −0.37 | Leaning Unfavorable | −0.32 | −0.53 | ▼ −0.38 | | 10 | Industrials
XLI | | −0.52 | Unfavorable | −0.28 | −0.79 | ▼ −0.14 | | 11 | Consumer Discretionary
XLY | | −0.76 | Unfavorable | −0.44 | −0.90 | ▶ −0.87 |
Prospect Score blends current conditions, district outlooks, momentum, a sector-specific macro tilt and margins. Now = weighted current conditions; Outlook = n/a when too few districts gave one; Mom. = change vs the average of the two prior releases. |
National Summary, scored −2 to +2 Macro backdrop | Overall Economic Activity | | +0.00 |
Little changed: five districts grew slightly, three were flat and four declined slightly to modestly (New York, Philadelphia, Minneapolis, San Francisco). Weaker than February. | One modest gain, four slight gains, four flat and three slight declines; firms adopted a wait-and-see stance on hiring and some prepared layoffs, with government-funded roles hit hardest. | | Inflation Pressure (higher = headwind) | | +1.25 |
Six districts modest and six moderate, similar to February, but suppliers sent increase notices, firms added tariff surcharges and expect to pass costs through; Kansas City price expectations rose robustly. | Financial conditions tightened modestly with falling bond and equity values (Chicago); credit standards tightened in Kansas City, Dallas and Atlanta CRE; mortgage rates edged up (New York) and Dallas loan growth decelerated sharply. | Outlooks worsened considerably on tariff uncertainty: San Francisco materially, New York and Philadelphia expect declines, Kansas City expectations weakened considerably, Chicago expects a slight decrease. |
|
Current conditions in each Fed district District by sector | BOS | NY | PHL | CLE | RIC | ATL | CHI | STL | MIN | KC | DAL | SF |
|---|
| Information TechnologyXLK | +1 | −1 | · | · | · | · | · | · | · | · | +1 | · | | Health CareXLV | · | −1 | · | · | · | · | · | · | · | −1 | +1 | · | | FinancialsXLF | · | −1 | · | +1 | · | · | −1 | · | · | · | · | · | | Consumer DiscretionaryXLY | · | · | · | −1 | · | −1 | +1 | · | −1 | +1 | −1 | −1 | | Communication ServicesXLC | · | −1 | · | · | · | · | · | · | · | · | · | · | | IndustrialsXLI | · | −1 | +1 | −2 | · | · | · | · | · | −1 | +1 | −1 | | Consumer StaplesXLP | · | · | · | · | · | · | · | +1 | · | · | · | · | | EnergyXLE | · | · | · | · | · | +1 | · | · | · | +1 | +1 | · | | UtilitiesXLU | · | · | · | · | · | +1 | · | · | · | · | · | · | | Real EstateXLRE | · | +1 | −1 | +1 | +1 | · | +1 | · | −1 | −1 | · | −1 | | MaterialsXLB | · | · | · | · | · | −1 | +1 | · | −1 | · | · | −1 |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
|
Top highlights What moved the scores Consumer Discretionary −1 outlook broad−based Boston, New York, Philadelphia, Cleveland, Atlanta, St. Louis, Kansas City, Dallas, San Francisco Retail outlooks turned decidedly pessimistic; travel bookings described as 'a cliff' (Kansas City). Why it matters: Nine of ten districts with an outlook are negative, the broadest negative outlook in the release. | Industrials −2 Cleveland Demand for manufactured goods declined moderately; foreign customers began cancelling orders. Why it matters: Only -2 read; Cleveland carries 7% of Industrials weight. | Industrials −1 outlook Boston, New York, Richmond, Atlanta, Chicago, Dallas, San Francisco Manufacturers turned pessimistic and paused capital equipment purchases amid tariff uncertainty. Why it matters: Broad negative outlook drags the Industrials prospect score despite flat conditions. | Real Estate −1 San Francisco, Minneapolis, Kansas City, Philadelphia Residential activity slow and CRE weakened as tenants paused expansion (San Francisco). Why it matters: San Francisco carries 27% of Real Estate weight, offsetting gains in New York, Cleveland and Chicago. | Financials −1 New York, Chicago NY finance kept weakening modestly; Chicago financial conditions tightened as bond and equity values fell. Why it matters: New York carries 28% of Financials weight; together these turn Financials negative. | Energy +1 / −1 outlook Dallas Oil and gas activity rose modestly, but contacts worry lower oil prices will dampen activity later. Why it matters: Dallas carries 45% of Energy weight; positive now, negative ahead. |
|
Twelve Fed districts District roundup Boston Growing +1.0 Outlook ▼ Increased slightly; outlook more pessimistic on tariff concerns. |
| New York Contracting −1.0 Outlook ▼ Contracted modestly; outlooks darkened, declining activity expected. |
| Philadelphia Contracting −1.0 Outlook ▼ Declined modestly; nonmanufacturing fell moderately. |
| Cleveland Flat Outlook ▶ Flat; weaker-than-usual spring, activity expected to stay flat. |
| Richmond Growing +1.0 Outlook ▼ Grew slightly despite federal staffing and contract cuts. |
| Atlanta Growing +1.0 Grew slightly; retail and tourism fell, home sales rose. |
| Chicago Flat Outlook ▼ Little changed; contacts expect a slight decrease next year. |
| St. Louis Flat Outlook ▼ Unchanged; outlook declined to slightly pessimistic. |
| Minneapolis Contracting −1.0 Outlook ▼ Lower; employment declined, construction fell. |
| Kansas City Growing +1.0 Outlook ▼ Grew slightly; expectations weakened considerably. |
| Dallas Growing +1.0 Outlook ▼ Growth slowed to slight; outlooks deteriorated. |
| San Francisco Contracting −1.0 Outlook ▼ Slowed slightly; outlook worsened materially. |
|
|
Where the signal is thin or split Divergences to watch | OUTLOOK vs CONDITIONS: conditions are near zero for most sectors, but outlooks turned broadly negative, especially for Consumer Discretionary and Industrials.
|
| | Consumer Discretionary — Chicago and Kansas City positives reflect tariff pull-forward buying that contacts expect to reverse.
|
| | Energy — conditions positive in Atlanta, Kansas City and Dallas, but Dallas (45% weight) expects lower oil prices to dampen activity.
|
| | Materials — higher steel and aluminum prices help margins while iron ore, lumber and timber demand weakened.
|
| | Health Care — no outlook coverage; conditions mixed with Dallas positive and New York, Kansas City negative.
|
| | COMMUNICATION SERVICES and UTILITIES: thin coverage; one district each.
|
|
|
How to read this. Each Fed district’s report is scored −2 (strong contraction) to +2 (strong expansion) for each GICS sector, then weighted by the district’s share of that sector’s activity. The Prospect Score blends current conditions (25%), district outlooks (35%), momentum (20%), a sector-specific macro tilt (10%) and margin pressure (10%). The Beige Book describes regional activity, not earnings or valuations. Weights and sensitivities are illustrative. This newsletter is for information only and is not investment advice. Source: Federal Reserve Beige Book · Scored by EconomyxAI |