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 Kansas City prepared the latest report. Information was collected on or before Feb. 22.
BOSTON: “Economic activity continues to expand in the First District, albeit slowly, according to business contacts. Most contacted retailers but only one-half of responding manufacturers report higher sales in the latest period than a year earlier; nonetheless, most manufacturers are upbeat about 2013. Contacted staffing services firms cite a pick-up in business, while several software and IT services firms say their results are below expectations although they maintain a positive outlook. Commercial real estate fundamentals are largely unchanged, with office leasing activity mixed. Most residential real estate markets across the region continue to show robust sales growth and modest price increases. Across sectors, vendor prices and selling prices are reported to be generally stable and headcount changes fairly modest, either up or down.”
NEW YORK: “Economic activity in the Second District has continued to expand at a moderate pace since the last report. Business contacts report some pickup in input price pressures but relatively few say they are increasing their selling prices. The labor market has shown scattered signs of improvement: manufacturers report an upturn in hiring, and a major employment agency notes increasingly strong demand for temps. Retailers report that sales have generally been strong and ahead of plan in January and early February. Auto sales in upstate New York were also described as robust since the beginning of the year. Tourism activity has been mixed but generally strong thus far in 2013, with hotels getting an additional boost from displaced residents and recovery workers in the aftermath of Superstorm Sandy. Both residential and commercial real estate markets showed signs of improving since the last report. Finally, bankers report increased loan demand, no change in credit standards, further narrowing in loan spreads, and lower delinquency rates on commercial loans and mortgages.”
PHILADELPHIA: “ Aggregate business activity in the Third District has maintained the modest pace of growth that was evident during the previous Beige Book period. In particular, general services and commercial real estate leasing continued to expand at modest rates. Activity in staffing services, transportation services, and residential construction appear to have accelerated somewhat to a modest rate of growth. The manufacturing sector reversed course again, citing slight declines in overall demand.
“The overall outlook for modest growth remains the same as those views expressed in the last Beige Book. Ongoing uncertainty over fiscal issues has postponed many business decisions. Contacts reported a fundamental optimism in the economy and described new signs of emerging growth; however, the ongoing uncertainty over fiscal issues has been blamed for continued weak consumer confidence and reluctance of businesses to make needed investments in plant, equipment, and labor.”
CLEVELAND: “The economy in the Fourth District grew at a modest pace since our last report. Manufacturing orders and production were steady or rose slightly. The momentum seen in residential construction at the end of 2012, including multi- family, has carried over into 2013. Retail purchases during January fell below year-ago levels, while motor vehicle sales posted solid gains on a year-over-year basis. Little change was seen in conventional oil and natural gas production, but shale gas activity expanded at a robust pace. Output at coal mines trended lower.
“Hiring was sluggish across industry sectors. Staffing- firm representatives reported that the number of job openings and placements picked up slightly since the beginning of the year. Vacancies were found primarily in the shale gas and motor vehicle industries and in professional business services.”
RICHMOND: “District economic activity grew moderately since our last report. Manufacturing strengthened somewhat in recent weeks. Tourism also picked up, while other non-retail services providers reported that activity grew at a slower pace. Retail sales rose, although auto sales slowed slightly from previous high levels. Lending activity increased marginally, with a slight uptick in demand for commercial and residential mortgages. Residential real estate activity grew at a modest pace, and commercial real estate and construction markets improved. The agricultural sector remained strong, while oil and natural gas production eased during the past six weeks. Labor markets were generally flat since our last report.”
ATLANTA: “Sixth District business conditions appear to have improved modestly in January and early February and the outlook among most contacts remained generally optimistic across sectors. Overall, retailers cited mild sales growth at the beginning of the year. The District’s tourism industry remained a bright spot with both domestic and international visitors contributing to its growth. Homebuilders and brokers noted home sales and prices were above year-ago levels for new and existing homes, while commercial real estate markets continued to witness slow but steady improvements in overall activity. Manufacturers reported increases in new orders and production. Reports from bankers suggested that loan demand remained constant, largely because of refinance activity. Hiring in District labor markets expanded at a modest pace and prices generally remained flat compared with late last year.”
CHICAGO: “Economic activity in the Seventh District continued to expand at a slow pace in January and February. Many contacts expected that growth would be weak in the first half of 2013, partly because of uncertainty over federal fiscal policy, but that activity would rebound in the second half of the year. Growth in consumer and business spending slowed during the latest reporting period, but the pace of manufacturing production improved. Residential construction rose at a moderate pace while nonresidential construction remained weak. Credit conditions continued to improve gradually.”
ST. LOUIS: “Economic activity in the Eighth District has expanded at a moderate pace since the previous report. Recent reports of planned activity in manufacturing and services have been positive. Retail sales over the past three months have increased compared with the same period a year ago. Reports on auto sales over the same period have been mixed. Residential real estate market conditions have continued to improve, and commercial and industrial real estate markets have also improved. Lending activity at a sample of large District banks indicated little change during the fourth quarter of 2012. Prices, wages, and employment levels over the past three months have stayed the same or increased for a majority of contacts across the District.”
MINNEAPOLIS: “The Ninth District economy showed signs of moderate growth. Increased activity was noted in consumer spending, tourism, professional services and manufacturing. Construction and real estate posted strong growth, while agricultural producers were in mostly strong condition. Activity in the energy sector was mixed, while mining slowed. Labor markets tightened modestly, and wage increases were moderate. Prices were generally stable with some exceptions noted.”
KANSAS CITY: “The Tenth District economy showed modest improvement in January and early February. Retail sales slowed during the beginning of the year, but vehicle sales were improved compared to a year ago. Manufacturing activity was weak among durable goods manufacturers, but non-durable manufacturers saw a slight improvement in activity, and high-tech services activity rose. Residential real estate activity and prices increased, but commercial real estate markets were flat. Bankers reported modest growth in loan demand and improvements in loan quality. Drought continued in the District and agriculture conditions deteriorated further. District energy activity expanded during the survey period. Wage pressures continued to be weak, but there was some evidence of upward pressures on prices.”
DALLAS: “The Eleventh District economy expanded at a moderate pace over the past six weeks. Reports on manufacturing activity were mixed. Retail sales were flat to up slightly, while automobile dealers noted a seasonal slowdown in sales. In the nonfinancial services sector, legal and accounting demand increased, and reports from staffing firms were mixed. Rail and cargo firms said activity weakened, but demand was above year- earlier levels. Airlines said passenger demand was flat to up since the last report. Housing demand remained strong and commercial real estate activity improved. Lenders noted flat to moderate growth in loan demand, and activity in the energy sector remained at high levels. Prices remained stable overall, and there were limited reports of wage pressure. Employment levels were steady to up.”
SAN FRANCISCO: “Twelfth District economic activity expanded at a modest pace during the reporting period of January through late-February. Price inflation was limited overall, and upward wage pressures were quite modest. Sales of retail items were up on balance, and most business and consumer services gained. District manufacturing activity ticked up. Production activity and sales were strong for agricultural producers. Housing demand trended up further, and commercial real estate activity expanded. Contacts from financial institutions reported small increases in overall loan demand and slight improvements in credit availability.”
To contact the reporter on this story: Vince Golle in Washington at firstname.lastname@example.org
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