US firms grow more pessimistic on economic outlook, Fed survey shows
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US economic activity continued to expand from early April through mid-May but firms grew more pessimistic about the future while inflation increased at a modest pace, a US Federal Reserve (Fed) survey showed on Wednesday, as central bankers mull how long they will need to keep interest rates at current levels. The survey, released roughly every six weeks, comes as policymakers remain uncertain on when to start a rate-cutting cycle after holding interest rates in the range of 5.25% to 5.50% for the past 10 months. Most Fed districts reported slight or modest growth in activity, while two noted no change in activity. The Fed's benchmark interest rate is set to remain unchanged at the next policy meeting on June 11-12 and Fed officials, while all but ruling out another rate hike, have indicated they need consistent encouraging inflation data over a number of months before lowering borrowing costs after being stung by bigger-than expected price increases the first three months of the year. US job gains were the fewest in six months in April and the increase in annual wages fell below 4% for the first time in nearly three years, but the labour market remains fairly tight.



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