Thursday, March 5, 2015

Beige Book: Economic Expansion Continues

Economic activities continued to expand across most regions and sectors according to February edition of the Federal Reserve Beige Book of 2015. Most of the 12 districts reported moderate to modest growth.

Banking conditions were mostly positive across the country with overall loan demand increasing in all districts except Kansas City, where loan demand was mixed. Credit quality has remained largely unchanged or has improved since the prior reporting period. Bankers in most Districts reported no change in their own lending standards.

Consumer spending rose in most regions, and optimism about near-term sales is high. Automobile sales also rose in most Districts. Five districts reported increased demand for trucks and SUV’s. Most of the remaining districts expressed optimism for future auto sales.

Employment levels remained stable or grew across sectors in most Districts. Employers in several districts encountered difficulties in filling a variety of skilled positions.

Growth in manufacturing varied across sectors, but generally increased since the last survey. Outlooks in manufacturing are generally positive, with most regions expecting near-term growth. The report did note however that the New York District was less optimistic than others about their near-term outlook, but did not state why.

Although home sales and prices generally increased, construction activity was lower in some Districts, partly due to poor weather conditions.

Weak agricultural conditions contributed to the slowdown in growth of the Kansas City, and Dallas districts. In addition to a decline in oil and natural gas drilling, persistent drought, a stronger dollar and labor disputes at West Coast ports negatively impacted exports from the regions.

Read the Federal Reserve release.

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