Beige Book: Economic Growth Modest to Moderate

January 17, 2012 (Chris Moore)

Economic activity was reported to be expanding at a modest to moderate pace in all Federal Reserve Districts according to the latest edition of the Beige Book released by the Federal Reserve covering economic activity from late November through the end of December.

Seven of the Districts described economic growth as modest while five of the Districts reported growth as moderate. New York and Chicago reported that the pace of growth in their districts had picked up while Dallas and San Francisco reported a moderate pace of growth and Richmond saw their economic activity as flat or only slightly improved.

Most Districts reported that holiday retail sales had improved over last year with New York and Dallas describing sales as brisk and robust. Auto sales were once again reported to have strengthened in most Districts with Atlanta reporting that sales in December and November were their strongest in two years and demand for autos was also reported to be strong in New York, Philadelphia, Cleveland and Minneapolis. The Kansas City District was the only District to report that spending had softened.

Residential real estate activity remained at very low levels with the exception of multi-family construction. Single-family home sales remained at depressed levels with Dallas being the only district that reported a modest increase over the following reporting period.

The Philadelphia, St. Louis, Minneapolis, and Kansas City Districts reported single-family home construction fell even further while Cleveland reported an improvement in construction activity in recent months.

The construction of multi-family residences rose in Boston, Philadelphia, Chicago, Kansas City, and Dallas Districts.

Boston and Atlanta reported that homes sales in their Districts were above the previous year’s levels, primarily due to the substantial drop in sales following the Homeowners Tax Credit in 2010. Most of Districts reported that home prices were stable but still below their levels from the previous year.

Overall loan demand showed little or no change from the last report with a slight increase in loan demand by businesses.

Four Districts, Cleveland. New York, Philadelphia, and Cleveland, reported increased demand or continued strength for residential mortgage refinances.

Credit standards and quality were largely unchanged across the Districts with stable or improving loan quality reported in Philadelphia, Richmond, Kansas City, Dallas, and San Francisco in all loan categories.

Tags: Federal Reserve, Beige Book, housing market, real estate markets, single family homes, multifamily market, construction activity

Source:
Federal Reserve