The economy grew modestly in October and early November in nine of the nation's 12 Federal Reserve bank districts, but Superstorm Sandy dampened activity in the Northeast, the Fed said Wednesday.
The Fed's beige book said modest growth was reported in the Cleveland, Richmond, Atlanta, Chicago, Kansas City, Dallas and San Francisco districts.
A "somewhat stronger increase in activity" was noted in the St. Louis and Minneapolis regions.
The report said the economy weakened in New York, Philadelphia and Boston, at least partly because of the storm.
Unlike most government statistical reports, the beige book, released every six weeks, provides an anecdotal snapshot of the economy based on interviews with businesses across the nation. The report is named for the color of its cover.
The report largely chronicles a continuation of recent trends, with consumer spending and the housing market improving modestly as rising home prices lift consumer confidence. In October, however, new home sales fell 0.3% to a seasonally adjusted annual rate of 368,000, the Commerce Department said Wednesday. Economists said the storm had only a small impact. Sales the previous month were revised down sharply
Meanwhile, uncertainty about Congress' ability to avert the looming tax increases and spending cuts known as the fiscal cliff have doused businesses' outlook. As a result, manufacturing and office leasing weakened, while the hiring outlook was mixed.
In New York, consumer spending looked robust before the hurricane, and merchants expect to recoup sales as residents replace damaged property. Furniture sales picked up in the Boston and Chicago areas but fell in Cleveland. Electronics sales were tepid in Chicago, but consumer technology sales strengthened in San Francisco.
The good news is that most regions were upbeat about holiday sales.
New York retailers expect to recover sales washed out by the storm, while Boston businesses expect higher online sales. Still, possible tax increases due to the fiscal cliff prompted retailers in the Boston, Cleveland and Chicago areas to say they're uncertain about holiday sales.
Hotel bookings, meanwhile, slowed in New York because of the storm, but "bounced back the next week." The hurricane devastated businesses in the Mid-Atlantic area. Convention activity in the Southeast, particularly Florida, picked up, though cruise line bookings were disappointing.
The housing market also continued to improve in most areas. The Cleveland and Richmond areas said sales were especially strong among high-price homes. Kansas City contacts said strong sales were reducing home inventories. But sales of both single-family homes and condos slowed in Boston and Philadelphia.
Meanwhile, businesses in Dallas said they were "holding back on expansions due to uncertainty."
Similarly, hiring improved modestly in most districts, but Richmond staffing firms said some manufacturers were unwilling to hire the long-term unemployed. Large employers in Atlanta were looking to hire part-time, rather than full-time, employees. Chicago firms also said some companies "were putting hiring on hold."
Wage growth, meanwhile, remained modest across most of the nation.
Most Popular Stories
- Chobani Counters Competition With Expanded Lineup
- Automakers Turn to China to Fuel Sales Growth
- Pope Francis, Huge Crowd Joyously Celebrate Easter
- GM Boosting China Production Capacity
- GOP Making Bold Play for Oregon Senate Seat
- Delay in Ferry Evacuation Puzzles Maritime Experts
- Report: Iran VP Says Row Over Reactor Resolved
- NASA's Space Station Robonaut Finally Getting Legs
- Confusion, Anger as Sunken Ferry's Relatives Wait
- Iran Denounces U.S. Ruling to Sell Property