WASHINGTON: The economy kept expanding in all regions of the country in June and early July, helped by strength in consumer spending, a Federal Reserve survey released Wednesday indicates.
All 12 of the Fed’s regions reported growth in the latest Beige Book survey with five — New York, Chicago, Minneapolis, Dallas and San Francisco — characterizing growth as “moderate” while the others, including Cleveland, reported “modest” growth. Boston and Richmond reported that growth came in at a slightly slower pace than the previous reporting period.
Payrolls increased mildly in the Federal Reserve Bank of Cleveland’s multistate district, with staffing firms saying job openings were found mainly in energy, health care and information technology.
The Cleveland Fed said new orders and production at factories grew slowly. Demand for construction services increased slightly.
Car sales were up moderately since Jan. 1. Retailers said sales of stores open at least a year were higher than in the same period in 2013.
Coal production and shale gas activity were little changed since the Cleveland Fed’s previous report. Activity in the Marcellus and Utica shales was stable but at a high level. And demand for business and consumer credit moved slightly higher.
The Beige Book will be used by central bank officials when they next meet July 29-30 to review interest rate policies.
Analysts expect that the Fed will decide to keep its short-term interest rate at a record low near zero and authorize another reduction in its bond purchases aimed at keeping long-term interest rates low.
Federal Reserve Chair Janet Yellen, who spent two days delivering the Fed’s twice-a-year policy report to Congress, emphasized before both Senate and House committees that despite recent sizable gains in employment, the central bank is in no rush to withdraw the massive support it is providing to the economy.
The Fed has kept its benchmark short-term rate at zero since December 2008, and many analysts believe the first rate increase is still about a year away.
The Beige Book survey was compiled from information gathered by the Fed’s 12 regional banks in the period before July 7. The report said that consumer spending had increased in every district with auto sales generally stronger than other retail sales.
Manufacturing gains were helped by strength in autos, metals and the aerospace industry.
Economists said the anecdotal reports contained in the Beige Book broadly supported their view that economic growth rebounded in the second quarter after weather problems caused a steep drop in output in the first three months of the year.
Beacon Journal staff writer Jim Mackinnon contributed to this report.