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Fed Districts See Modest Growth

TSC Staff

Most Federal Reserve districts reported modest expansion in economic activity in recent weeks, but several regions noted some slowing, the U.S. central bank said in its "beige book" released Wednesday.

The New York district characterized growth as well maintained but with a few signs of deceleration, the Fed said. St. Louis said that activity increased more slowly than in the previous period, Boston reported some softening, and Dallas said economic activity continued to decelerate.

At the same time, economic conditions improved slightly in the Philadelphia Fed's region.

Most districts reported steady growth in retail sales, but vehicle sales remained sluggish. The majority of the 12 regional banks said they were facing further expansion in their labor markets and a continued tight supply of skilled and professional workers.

"With rising demand for many types of workers, wage pressures increased slightly in several districts, although pay increases generally remained moderate overall," the Fed said.

Additionally, most districts said price pressures were little changed. Energy and construction-related materials prices fell, but food input costs rose in several areas.

Manufacturing activity was steady or expanding in most districts, although Dallas, Richmond and St. Louis reported slower growth or a decline. In the Chicago region, manufacturing was soft, but recent signs suggest a firming.

Activities related to residential real estate remained sluggish, especially for production of household appliances, furniture and building materials. Nearly every district reported that housing markets remained weak. However, indications of stabilization are being seen in several regions.

The latest beige book was prepared at the Kansas City Fed and is based on information collected on or before Feb. 26. The information summarizes comments received from businesses and other Fed contacts and isn't intended to represent the views of the central bank's officials.