According to the Federal Reserve Beige Book economic report release Wednesday, consumer spending is slowing. The report is based on information from 12 Federal Reserve Districts in the U.S.
Here’s a broad overview of what they said. (For more, including district detail, click here.)
Overall, reports indicate economic activity is slow and business conditions are “weak,” “soft” or “subdued.” Not all markets are seeing this, however, as Boston and New York had signs of stabilization and Kansas City has seen a slight improvement.
Auto sales are falling or steady at low levels; tourism was mixed; and demand for services has lessened. The transportation industry has been adversely affected by rising fuel costs, and manufacturing activity has declined in most districts -but growth was seen in Minneapolis and Kansas City. Not surprisingly, residential real estate markets remained soft, and commercial real estate activity was slow in most districts, with a slowdown in demand for office and retail space.
Districts reporting on energy and mining activity recorded increased economic activity including a strong demand for workers.
Price increases have not let up, due to energy, food and other commodity costs. Still, there have been declines or slower increases in pricing for some industrial commodities and energy products. Wage pressures were characterized as moderate in most districts.
Here are the breakdowns for manufacturing and construction, according to the Beige Book:
Manufacturing activity was weak or declining in most districts but improved in others. Improvements made in New York, Kansas City, Minneapolis and San Francisco. Exports seem to be contributing to these increases though that contribution may be weakening. Several districts reported declines in demand for housing-related products and construction materials. Boston has seen a decline in the output of aircraft and other transportation parts and equipment, but San Francisco reported a high rate of aircraft production.
Motor vehicle and related products output was falling. Demand is increases for information technology equipment. Manufacturers in Philadelphia, Cleveland, and Kansas City have increased capital spending or plan to do so, but Boston reported that manufacturers in that District were reexamining capital spending plans, and Chicago reported that several firms were postponing capital projects.
Residential real estate conditions remained soft in all districts, except for Kansas City. Demand for housing continues to trend down. Multi-family construction in some areas, including New York, has gone up. Atlanta and Dallas have seen unsold inventories go down. Commercial real estate moved down or remained weak in all districts except for Dallas. Dallas and San Francisco reported public projects had buoyed activity.
Read the full Fed report here.
Find economic indicators updated monthly at the MDM Databank.