Business as a whole is positive for the economic outlook for the coming months, despite widespread concerns about the possible negative impact of trade uncertainty, according to the Federal Reserve’s Beige Book.

The Fed’s 12 regional banks reported that economic activity grew modestly in the early summer. The information in the report is collected by July 8th. Many companies have expressed optimism about the future, although they continue to follow closely the ongoing trade talks.

“Prospects for the future are generally positive for the coming months with expectations of continued modest growth despite widespread concerns about the possible negative impact of trade-related uncertainty”, said the report.

Despite a healthy economy, Federal Reserve Governor Jerome Powell signaled last week that the central bank was ready to cut interest rates. This could happen as early as the summit on July 30-31, because of fears that the slowdown in global economic growth and trade strain could have consequences for the country’s economy.

Companies surveyed indicated consumer spending as one of the driving forces of the economy at the moment, despite weak car sales. Retail sales in the United States increased for the fourth month in a row.

Business representatives from the tourism sector are also optimistic. Manufacturers, however, continue to be concerned about the uncertainty surrounding the trade negotiations. A manufacturer of electronic components from the northeastern part of the United States has explained that he has had to cut staff due to the duties introduced and that he has moved a production line to Germany where he can get goods from China without paying for them.

At the same time, companies continue to complain about the shortage of employees. Wages in the US are rising moderately with some employers even expanding the benefits package to attract workers.

A detailed review of the document shows why interest rate cuts are likely to happen, namely adapting companies to supply chain changes, duties, visas, and other issues. These issues are related both to the weakened global economy and the policies of the Trump administration, and are the main element of doubt about the future in the otherwise optimistic outlook of the report.

The Fed points out that there is a weakness in the transport companies’ business because of the problems in production. Also reported are companies experiencing difficulties in securing and replacing work visas for employees with specific skills.