Federal Reserve sees improvement in U.S., Midwest economies
A much maligned Federal Reserve issued its Beige Book report Wednesday. The report finds all 12 districts of the Reserve in an improved position over its last report.
The ninth district of the Federal Reserve is perhaps strongest among the 12 reporting, with an overall rating of steady or modest improvement. Where the Minneapolis-based ninth district shines brightest is in real estate and construction, which is strong and or improving, according to the Fed.
Only Kansas City is reporting similar results in that sector of the economy, but the 10th district is weaker in manufacturing and retailing.
Minneapolis is reporting steady or modest improvement in the economy in manufacturing and retailing.
Boston’s district one is perhaps the weakest unit of the Fed, reporting in with an overall rating of mixed, and a weak or declining real estate and construction sector.
St. Louis, headquarters of the eighth district, is reporting weak manufacturing, as is the Cleveland district.
What does all this mean? It signals some bright spots in an economy that has been in a recessionary slump for nearly five years.
The Federal Reserve reported only a slight uptick in consumer spending during the Christmas holiday, with sales rising a meager 2.7 percent over sales a year earlier. However, the gain was less than the 5.5 percent of 2010.
Concerns over budget battles that have been looming since early December’s fear of going over the fiscal cliff and ongoing battles with Congress and the White House continue to put a damper on consumer confidence.
“Since the previous Beige Book, consumer spending increased to some degree in all 12 Districts,” according to Businessweek.
This glimmer of optimism may be overshadowed if continued battles over the debt ceiling and cuts to a bulging national debt are not addressed by governmental leaders.