Beige Book Highlights: Modest Growth Continues
The Federal Reserve's most recent report on current economic conditions, also known as the Beige Book, was released earlier today. The national summary began, "economic activity generally expanded at a modest to moderate pace since the previous Beige Book.” The Sixth District’s report struck a similar tone, stating “business conditions appear to have improved modestly.” In comparing these two lead sentences, it appears that the Southeast economy continues to follow the same growth trend as the rest of the United States.
Although the Beige Book reports on several sectors of the economy, given the Fed’s dual mandate of maximizing employment and maintaining price stability, it’s always interesting to read what is written regarding these two topics in the national summary.
The national summary stated:
Price pressures remained modest. The majority of Districts reported modest improvements in labor market conditions, although hiring plans were limited in several Districts.
In comparison, the Sixth District’s summary was similar:
Hiring in District labor markets expanded at a modest pace and prices generally remained flat compared with late last year.
From the tone of the reports, the economy seems to be moving in a positive direction, albeit slowly.
Below are other sector highlights from the Atlanta Fed's contribution to the Beige Book:
- General conditions and outlook: On balance, Sixth District business conditions appear to have improved modestly in January and early February, and the outlook among most contacts remained generally optimistic across sectors.
- Consumer spending and tourism: Overall, retailers cited mild sales growth at the beginning of the year. The District’s tourism industry remained a bright spot with both domestic and international visitors contributing to its growth.
- Real estate and construction: Homebuilders and brokers noted home sales and prices were above year-ago levels for new and existing homes, while commercial real estate markets continued to witness slow but steady improvements in overall activity.
- Manufacturing and transportation: Manufacturers reported increases in new orders and production. District rail companies reported lower total carloads from a year earlier but slight increases in intermodal traffic.
- Banking and finance: Reports from bankers suggested that loan demand remained constant, largely because of refinance activity.
- Natural resources and agriculture: As domestically produced oil has become increasingly available, Gulf Coast refiners reported declining dependence on imported crude for processing and the export of more refined product. Recent rains improved drought conditions in Alabama and Georgia, while Florida saw dry conditions expand over most of the state. Prices for corn, soybeans, beef, broilers, and eggs were higher than year-ago levels while the price for cotton was down.
The Beige Book is published eight times per year and contains individual Reserve Bank reports as well as a national summary. Each Federal Reserve Bank gathers anecdotal information on current economic conditions in its District through reports from Bank and branch directors and interviews with key business contacts, economists, market experts, and other sources. The next Beige Book will be published April 17.
By Shalini Patel, a senior economic research analyst in the Atlanta Fed's research department
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