US economy grows slightly, Fed signals possible interest rate hike in September

Washington. The US economy has grown slightly in recent weeks, according to the US Federal Reserve's (Fed) economic report (Beige Book) published on Wednesday. Prices also rose moderately and employment increased slightly overall, it said.

The outlook for the coming months is generally positive. However, there is increased uncertainty across all sectors due to increased energy prices, the political situation and international conflicts. In some of the twelve Fed districts, companies have also encountered greater price sensitivity among consumers, which makes it more difficult to pass on higher costs.

The report will serve as a basis for the monetary authorities for their next interest rate meeting on September 15th and 16th. The Fed has kept its key interest rate in the range of 3.50 to 3.75 percent since December. On the financial markets, the probability of an interest rate increase this month is around 65 percent. Fed Chairman Kevin Warsh said last week that his main focus was inflation. The inflation rate has been above the central bank's target of 2.0 percent for around five and a half years.