Yigit Taha OZTURK 
The Federal Reserve’s latest Beige Book report paints a picture of a still-active U.S. economy with emerging risks. International travel has taken a hit, dragging down the tourism and hospitality sector as domestic spending also slows.
New York, Boston, and Atlanta Fed branches reported a sharp decline in visitors from Canada, and uncertainty over European and Chinese travel this summer. Hotel reservations from international guests have dropped notably, and large hospitality companies are hiring fewer seasonal workers amid unclear immigration policies.
Federal Budget Cuts Hit Multiple Sectors
Recent federal government spending cuts are impacting not only the public sector but also businesses across aviation, manufacturing, and law. Dallas and Philadelphia Fed branches highlight reduced demand due to travel and event cancellations. Meanwhile, the Cleveland Fed notes increased demand for legal services tied to government and nonprofit concerns over shifting policies.
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Food Banks Under Pressure
Food assistance networks are feeling the squeeze. The Kansas City Fed reports that budget cuts to the Department of Agriculture have led to fewer distributions, especially for senior citizens. Some pantries have slashed their allocations. Dallas Fed notes that housing providers are hesitant to rent to tenants relying on federal aid due to funding freezes.
Trade Tensions Are Driving Price Changes
While general price increases remain modest, trade-exposed sectors are seeing sharper rises. The Atlanta Fed notes that dairy producers are struggling due to decreased cheese exports to Mexico. The Richmond Fed reports record price hikes at coffee roasters. The St. Louis Fed highlights retailers resisting supplier price hikes, with suppliers adjusting pricing based on shipment dates.
According to the Richmond Fed, port operators are worried about a proposed port tax on Chinese vessels that could quadruple cargo handling costs. Several ports also received multimillion-dollar tariff bills for Chinese cranes ordered before the new tariffs were imposed.
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