Following is a summary of U.S. economic conditions as reported by the 12 Federal Reserve district banks in the central bank’s latest regional survey, also known as the Beige Book.
The Federal Reserve Bank of Cleveland prepared the latest report. Information was collected on or before April 2.
Boston: “Economic activity continues to expand at a moderate pace in the First District. Most contacted retailers, manufacturers, and consulting and advertising firms report higher revenues in recent months than a year earlier. Commercial real estate markets are mostly unchanged, while residential contacts across the region cite rising sales and declining prices. Retailers express concern about what rising energy costs may do to consumers’ willingness to spend, while manufacturing contacts acknowledge the increasing costs, but say they are not a problem.”
New York: “Growth in the Second District’s economy has picked up somewhat since the last report. Labor market conditions have been stable to slightly stronger in recent weeks, and a sizable number of contacts say they plan to add workers in the months ahead. While consumer prices generally remain steady, business contacts in a number of industries indicate rising cost pressures. Manufacturers report steady improvement in business conditions. Most retailers and auto dealers describe sales as steady but strong in February and the first few weeks of March. Tourism activity has been mixed but generally strong since the last report, with bookings for the months ahead described as robust.”
Philadelphia: “Overall, business activity in the Third District has continued to show slow, steady improvement since the previous Beige Book. Overall sentiment improved, and the unseasonably mild weather undoubtedly contributed to this. Since the last Beige Book, manufacturing activity has grown further, and many manufacturing industries have contributed to this growth; however, the pace has slowed slightly. Retail sales continued to grow modestly. Motor vehicle dealers experienced unseasonably strong sales growth in February, but sales were less robust in March. Third District banks have reported slight growth in demand and continued strong credit quality since the last Beige Book.”
Cleveland: “The economy in the Fourth District grew at a modest pace since our last report. Manufacturers reported a small increase in production, while activity in residential and nonresidential construction picked up slightly. Many retailers and auto dealers characterized February sales as good. Energy production was stable except for shale gas, where activity expanded. Freight transport volume trended higher at a moderate rate. And the demand for business and consumer credit improved slightly. Hiring remains at a low level and was mainly limited to the manufacturing and freight transport sectors.”
Richmond: “Business conditions have improved in the Fifth District economy since our last report. Manufacturing activity continued to advance, although somewhat more slowly than at the beginning of the year. While trade activity increased, imports improved somewhat more slowly than exports. Retail sales activity rose sharply, as shopper traffic increased and big- ticket sales strengthened. Realtors noted an increase in sales of existing homes, and contractors reported an uptick in new home construction.”
Atlanta: “Reports from Sixth District business contacts indicated that the pace of economic activity expanded at a moderate pace in late February through March. Expectations remained generally positive across most sectors, although contacts expressed concern regarding the impact of higher energy prices on the outlook. Retailers mostly indicated sales were growing at a modest pace and auto sales remained strong. Leisure and hospitality businesses reported robust activity in all segments except cruise lines. Homebuilders and brokers experienced improvements in sales of new and existing homes while multifamily construction remained strong.”
Chicago: “Economic activity in the Seventh District continued to expand at a moderate pace in late February and March. Growth in consumer spending picked up, and business spending continued to increase. The pace of growth in manufacturing production was little changed and construction activity increased. Credit conditions improved slightly. Energy prices increased, but with limited pass-through to downstream prices, and wage increases remained moderate. Soybean and cattle prices rose, while corn, wheat, milk, and hog prices decreased.”
St. Louis: “The economy of the Eighth District continued to grow at a modest pace since our previous survey. Residential real estate market conditions have improved moderately. Similarly, commercial real estate market conditions also have improved. However, recent reports of plans from firms in the manufacturing and services sectors were more mixed. Overall lending at a sample of small and medium-sized District banks was essentially unchanged during the three-month period from mid- December to mid-March.”
Minneapolis: “The Ninth District economy grew at a solid pace since the last report. Strength was noted in consumer spending, professional services, construction, manufacturing, energy and mining, and agriculture. Residential real estate had an unexpectedly large increase in sales activity. Warm weather slowed winter tourism activity. Hiring activity outpaced layoffs since the last report. Wage increases were moderate, and price increases were generally subdued.”
Kansas City: “The Tenth District economy expanded at a faster pace in late February and March. Consumer spending improved, residential real estate activity rose solidly, and commercial real estate activity edged higher. Growth in the energy industry eased slightly but remained solid. Manufacturing firms reported further increases in activity, and agricultural conditions improved from the previous survey. Transportation activity picked up slightly, and high-tech service firms said sales growth was mostly solid. Bankers noted steady loan demand, better loan quality, and rising deposits. Prices rose slightly, but wage pressures were contained outside of a few skilled positions.”
Dallas: “The Eleventh District economy grew at a moderate pace over the past six weeks. Overall manufacturing activity continued to expand. Demand for business services rose slightly, and transportation services activity remained positive overall. The housing sector continued to improve modestly, and nonresidential leasing activity remained solid. Respondents said retail sales grew at a modest pace and auto sales strengthened. Financial firms noted a modest pickup in loan demand. Energy activity continued to be strong, although gas-directed drilling activity weakened. Drought conditions improved. Employment levels were steady to slightly higher. Prices were unchanged or somewhat higher, according to contacts. Outlooks across industries remain positive, but more respondents noted concern about higher energy costs.”
San Francisco: “Economic activity in the Twelfth District continued to expand at a moderate pace during the reporting period of late February through the end of March. Despite higher energy prices, overall price pressures for final goods and services remained modest, as did wage gains. Sales of retail items and demand for business and consumer services rose further. District manufacturing activity increased on net. Demand was robust for agricultural producers but remained uneven for providers of energy resources. Activity in District housing markets strengthened modestly but remained lackluster on balance, and demand for nonresidential real estate was largely unchanged. Contacts from financial institutions reported small increases in overall loan demand and slight improvements in credit quality and availability.”
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