All 12 Federal Reserve districts saw economic activity expand in May, with the pace of growth climbing most around Cleveland and St. Louis. Activity around St. Louis slowed, according to the latest edition of the Fed’s beige book.
Retail sales grew at a moderate pace across most of the country, the Fed said, although lingering wintry weather weighed on retail activity in the Northeast. Half of all districts reported climbing vehicle sales. Tourism was strong.
In housing, low inventories constrained sales in the Northeast and around Kansas City. Residential construction activity was mixed, the Fed said: Half of all districts reported increases, but a few indicated weakness. Multi-family construction remained particularly robust.
Manufacturing activity expanded throughout the nation, and was especially strong along the East Coast and around St. Louis and Kansas City.
The labour market strengthened, and several Fed Districts reporting shortages of skilled workers. However, in most Districts, wage increases have remained generally subdued. Some prices moved up a bit, but most held steady.
“Contacts continue to believe that the U.S. economy is improving,” the Boston Fed reported. “One source terms the recent weakness ‘just a hiccup.’ ” The only serious concern, Boston recounted, were overseas sales. “Europe is still a mess.”
Other choice quotes:
- Auto sales were “phenomenal” — Philadelphia Fed
- Raw milk prices were at an “all time high” — Boston Fed
- “Bankers admitted that they were getting ‘a little more aggressive’ due to competition; however, they did note that they were not changing their loan structure or underwriting.” — Atlanta Fed