The American economy is absorbing some serious body blows right now. Tariffs are lifting import costs, oil prices are elevated, and fertilizer and petrochemical prices have followed suit. Yet Beth Hammack, president and CEO of the Federal Reserve Bank of Cleveland, is walking away from conversations with business leaders feeling something closer to cautious optimism than alarm.
In a June 2 address to the City Club of Cleveland, Hammack described an economy that is bending but not breaking under the weight of those pressures.
What businesses are actually saying
Hammack’s read on the economy is grounded in direct contact with executives across the Fourth Federal Reserve District, which covers Ohio, western Pennsylvania, eastern Kentucky, and the northern panhandle of West Virginia. What she is hearing is that companies have adapted their operations to absorb higher input costs and are still committing capital to growth.
Capital expenditures have picked up, with a notable concentration in artificial intelligence infrastructure and software. Consumer spending has remained intact as well.
