Beige Book Reveals Sluggish Economic Activity

Specific sector and district results include:

• ? Manufacturing activity continued to expand in most districts, although several districts reported that activity had slowed or leveled off during the reporting period.
• ? Districts also noted improved conditions in the services sector.
• ? The five districts reporting on transportation noted increased activity.
• ? Tourism activity also increased across the Districts, although the Atlanta District noted concerns about decreased leisure travel to the Gulf Coast.
• ? Retail sales reports generally indicated a continued rise in spending, and several Districts noted that necessities continued to be strong sellers, while big-ticket items moved more slowly.
• ? However, most Districts that reported on auto sales noted declines in recent weeks.
• ? Activity in residential real estate markets was sluggish in most Districts after the expiration of the April 30 deadline for the homebuyer tax credit.
• ? Commercial real estate markets, especially construction, remained weak.
• ? Banking conditions varied across the Districts, with some Districts noting soft or decreased overall loan demand; credit standards remained tight in most reporting Districts.
• ? Recent rains had mixed effects on crop conditions, while activity in the natural resources sector increased.
• ? Overall labor market conditions improved modestly across the Districts, with several reports of temporary hiring.
• ? Consumer prices of goods and services held steady in most reporting Districts. Input prices also held largely steady, with only a few reports of cost increases.
• ? Wage pressures continued to be contained on the whole.