US Economic Growth “Modest to Moderate” — Beige Book

The US Federal Reserve’s summary of current economic conditions in the 12 Fed districts — commonly called the ‘Beige Book’ — was released this afternoon. The report is based on data through July 9th.

The report noted that the economy expanded in all 12 Fed districts, but that growth in New York, Philadelphia, and Cleveland was slower than the last report. Atlanta, St. Louis, and San Francisco reported modest growth, and the other six districts reported modest growth.

The report on housing was particularly positive:

All [12 Fed] District housing market reports were largely positive as sales and construction levels increased and home inventories declined. Rental markets continued to strengthen with rising rents being reported in Boston, New York, Atlanta, Chicago, and Dallas. Commercial real estate leasing and construction continued to improve as demand for multifamily units increased in Atlanta, Chicago, and San Francisco. However, both New York and Richmond noted a slowdown in commercial activity, while Philadelphia and Dallas held steady.

On the manufacturing front, the news was more mixed, with expansion characterized as ‘slow’ in most Fed districts and new orders decelerating. Employment levels grew at a “tepid pace” in most Fed districts, and overall the districts reported cautious optimism about future business conditions.

The Beige Book had almost no impact on stock prices, as the three major indexes rose less than 1% on the release and quickly reversed back to earlier levels.

The Beige Book is available here.

Paul Ausick