US economy grew 'modestly' in summer: Fed Beige Book

NEW YORK (AA) – The U.S. economy grew "modestly" through the summer but the country’s presidential election in November could bring uncertainty, the Federal Reserve's Beige Book said Wednesday.

Most of the Fed’s 12 districts reported "moderate" overall economic growth during the reporting period of July through late August, the Fed noted in the book that gauges economic conditions.

Kansas City and New York reported no change in activity but Philadelphia and Richmond showed activity slowed from the previous period.

Overall consumer spending, which the Fed watches closely for its 2 percent inflation target, recorded little change in most of the 12 districts, the central bank said.

On the brighter side, most of the regions said they believe "the worst of the oil bust slump has passed." They added, however, that economic growth has not yet returned to normal levels.

Retail sales volumes changed only a little, auto sales somewhat declined in some districts, tourism activity was mostly flat and manufacturing activity was flat to slightly up in general, according to the Beige Book.

Some districts noted that the election could pose uncertainty for the domestic economy.

"Contacts in several districts cited only modest expectations for sales and construction activity moving forward, due in part to economic uncertainty surrounding the November elections," the Book noted.

The Fed stresses that it is an independent institution, especially from the political sphere.

Some analysts argue however that the Federal Open Market Committee could wait until after the election to increase the Fed's benchmark interest rate, making it possible for just one rate hike this year at its December meeting.