The Federal Reserve Board and the Federal Open Market Committee on Tuesday released the minutes of the Committee meeting held on August 5, 2008. Here is an excerpt:

The information reviewed at the August meeting indicated that the economy expanded at a moderate pace in the second quarter, but recent financial market developments highlighted some of the stresses that the economy faced going forward. Both consumer and business spending recorded gains in the second quarter, and net exports contributed importantly to the rise in real gross domestic product. However, residential construction continued to fall sharply, the labor market weakened further, and industrial production declined. Core consumer price inflation remained relatively stable, while headline inflation was elevated as a result of large increases in food and energy prices.

Labor demand continued to contract in July. Private nonfarm payroll employment fell in July at a pace only a bit less than the average monthly rate during the first six months of the year. By industry, the pattern of job losses was roughly similar to those earlier in the year, although July’s report showed a smaller decline in construction than earlier. Nonbusiness services, which include health and education, remained the only notable source of net additions to employment. Both the average workweek and aggregate hours edged down in July. The unemployment rate rose in July and was about 1 percentage point above its level of a year earlier, while the labor force participation rate was about unchanged.

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