Fed Survey: Economy Improving Across the Nation

beige book survey
Andrew Harrer/Bloomberg via Getty ImagesFederal Reserve Chair Janet Yellen
By MARTIN CRUTSINGER

WASHINGTON -- A Federal Reserve survey shows the U.S. economy strengthening over the past two months in areas from manufacturing and construction to retail sales and bank lending.

Seven of the Fed's 12 regions -- Boston, New York, Richmond, Chicago, Minneapolis, Dallas and San Francisco -- reported "moderate" growth during the early spring, while the remaining five described growth as "modest," according to the Beige Book survey released Wednesday.

Retail sales were reviving, helped by pent-up demand for new cars after the harsh winter, the survey found. Manufacturing was expanding in all regions, along with lending. One weakness was home sales, held back in large part by a tight supply of available homes.

The Beige Book is based on anecdotal reports from businesses and will be considered along with other data when Fed policymakers meet June 17-18.

Nothing in the report is likely to alter the widespread view that the Fed thinks the economy is reviving after a winter slowdown.

Economists generally believe the Fed in June will pare its pace of monthly bond purchases by another $10 billion while pledging to keep its key short-term interest rate at a record low near zero for a "considerable" period after its bond purchases end.

Beginning in December, the Fed has been reducing its bond purchases, which were designed to keep long-term rates low to spur spending and economic growth. The purchases, now at $45 billion a month, will likely be phased out entirely this fall.

The Beige Book suggests that despite the spring rebound in activity, inflation remains contained and wage pressures subdued. Low inflation has given the Fed the leeway to keep interest rates exceptionally low to try to boost growth and lower unemployment.

The Fed survey said the job market in much of the country has improved since its last Beige Book. Cleveland and Chicago reported increased demand for temporary workers. Several districts reported that employers were having trouble finding skilled workers.

Manufacturing activity expanded in all 12 districts, with robust gains reported in the Boston, New York, Atlanta and Kansas City districts. Growth was especially strong at factories connected to the auto, aerospace and metal industries.

Two-thirds of the Fed's districts reported rising demand for bank loans. Particular strength was seen in New York and San Francisco. Demand for auto loans was strong, coinciding with reports of robust new-car sales.

But the Boston, New York and Kansas City regions reported that home sales were being held back by low or dwindling supplies of available homes. Other regions also described availability as low.

Fed Chair Janet Yellen has said that the Fed is monitoring conditions for any signs that the housing recovery is faltering.


Increase your money and finance knowledge from home

Socially Responsible Investing

Invest in companies with a conscience.

View Course »

Portfolio Basics

What are stocks? Learn how to start investing.

View Course »

Add a Comment

*0 / 3000 Character Maximum

31 Comments

Filter by:
Valerie

The Fed report would be humorous, if it were not so clueless and off base.

Except for a few pockets of scattered prosperity around the country, there are still millions of increasingly desperate people looking for a job. Cities are full of vacant storefronts and beggars holding cardboard signs.

Prices for all needed items and services (food, fuel, housing, clothing, health care, etc.) continue to rise. The only falling prices are for consumer purchases that are not needs --- electronics, vacation cruises, etc.

June 06 2014 at 4:10 AM Report abuse rate up rate down Reply
nthereoff

Prices of just about everything still going up.I know friends and family that are still unemployed and looking for work. The economy getting better, If you say so..

June 05 2014 at 11:38 AM Report abuse +1 rate up rate down Reply
mistergg69

Raising minimum wage to $10.10 will help improve economy and decrease spending on food stamps and medicaid for the working poor.

June 05 2014 at 8:18 AM Report abuse +3 rate up rate down Reply
1 reply to mistergg69's comment
teaparty2implode

How true, conservatives don't see it that way. They would rather have people work $8/hr and have people more dependent on government just like they do in large numbers in the red states.

June 05 2014 at 9:04 AM Report abuse +5 rate up rate down Reply
jrb359

And we don't have a $17.5 trillion debt, there are plenty of good paying jobs, and the economy is again on an upward swing! Also Obama, Reid, Pelosi, Sebelius, Susan Rice, Hillary and Willy don't tell lies! More government LIES!

June 05 2014 at 5:51 AM Report abuse -6 rate up rate down Reply
1 reply to jrb359's comment
mistergg69

Do you want to go back to the days of looking for Iraqi WMD?

June 05 2014 at 8:19 AM Report abuse +5 rate up rate down Reply
1 reply to mistergg69's comment
teaparty2implode

Bush still holds the record for jobs lost, over 3 million jobs outsourced under Bush. Millions of people lost their jobs no fault of their own to corporate greed. We don't need the American worker anymore, we don't have to pay a good wage or offer any benefits. We now have third world countries who will work for cheap wages and no benefits.

June 05 2014 at 2:18 PM Report abuse +3 rate up rate down
jacobsgold

More BS. We are making less than in 2008.

June 04 2014 at 10:38 PM Report abuse -1 rate up rate down Reply
Mary Ann

Ted_Williams and Common Sense show some good sense and debating skills. When someone comments with emotion and name calling, they are just blabbing and taking up space. And they waste my reading time. But then,it is human nature to slow down and gawk at an accident.

June 04 2014 at 9:54 PM Report abuse +2 rate up rate down Reply
mlpresnall

can't type either nor use spell check it appears - but that's it from me anyway; just thought I'd say.

June 04 2014 at 9:50 PM Report abuse +1 rate up rate down Reply
mlpresnall

Not an economist nor highly educated like so many or you folks and our leaders; I still think linking the ability to print money to something like a gold standard makes sense.

June 04 2014 at 9:49 PM Report abuse +2 rate up rate down Reply
1 reply to mlpresnall's comment
mistergg69

When we were on a gold standard we had economic recessions and depressions.

June 05 2014 at 8:21 AM Report abuse -2 rate up rate down Reply
mlpresnall

none the less
Sorry

June 04 2014 at 9:47 PM Report abuse -1 rate up rate down Reply
mlpresnall

Like I said, was not there to read this in person, not sure if TJ actually said it - but I think he would have if he didn't - seems pretty much what we have non the less.

Just my humble opinion of course.

June 04 2014 at 9:46 PM Report abuse -1 rate up rate down Reply