Fed's Beige Book: Economy Grew 'At Modest to Moderate Pace'

WASHINGTON (MNI) - Overall economic activity, had expanded at a moderate from April to late May, "continued to expand a modest to moderate pace in June and early July," the Federal Reserve's latest survey of conditions around the country said Wednesday.

The Fed's so-called 'Beige Book' said "Overall, Districts reported that their contacts remained cautiously optimistic future business conditions."

For , three districts are reporting "modest growth" and five districts moderate expansion, a context of "modest" price inflation and "minimal" wage pressure consistent a "tepid pace" of employment growth.

The Philadelphia, New York and Cleveland Federal Reserves, , said the pace of expansion in their districts was "slower" the previous report.

The Philadelphia district already reported a slightly slower pace of growth for early April to late May -- when New York and Cleveland had reported moderate growth.

And the time when both Fed Chairman Ben Bernanke and Federal Open Market Committee have clear any additional monetary easing will depend the jobs outlook, the report noted slow progress that front.

"Employment levels grew a tepid pace for most Districts the last report," the Beige Book said.

The survey findings summarized by the Atlanta Fed based information collected through July 9 and will be reviewed the Fed's policymaking Federal Open Market Committee when it convenes July 31 and August 1.

Reports across districts were "largely positive" the housing market, the Beige Book said, including higher sales and construction levels and lower inventories homes.

Meanwhile, rental markets strengthened .

Commercial estate activity, however, was "mixed."

Reports consumer spending reflected modest improvements, tourism was "strong" in several districts.

"Most Districts reported modest increases retail spending on a year-over- basis, but many reported slower growth in recent months compared earlier in the year," the report said.

It noted "a few reports" mentioning a negative impact sales from high temperatures.

Still, among reports of increased retail sales, "most noted strength auto sales," the Beige Book said. "In , auto dealers noted that demand for fuel-efficient vehicles continued support sales."

In the manufacturing sector, "activity continued to expand slowly most Districts," the report said, noting hiring varied by district.

Elsewhere, the report noted a "generally stable" demand nonfinancial services.

In of loan demand, especially for loans related real estate, the report noted a modest increase.


Adapted from: mninews.deutsche-boerse.com, July 18, 2012.