Economic Growth In Eighth District Largely Mixed, Fed Says
by September 9, 2015 10:53 am 117 views
Economic growth continued at a moderate pace in the Eighth District as manufacturing activity, consumer spending, wage growth and other business activity were largely mixed at the end of August, according to the Federal Reserve’s monthly Beige Book report.
In the St. Louis Eighth District, which includes Arkansas and portions of Illinois, Indiana, Kentucky, Mississippi, the eastern half of Missouri and West Tennessee, a survey of 150 businesses across the expansive region indicated that wage growth was moderate, while employment and prices grew modestly.
Fifty-nine percent of contacts indicated that wages during the past three months were higher, and 38% indicated wages were unchanged relative to the same period last year. Thirty-seven percent of contacts reported that employment during the past three months was either higher or somewhat higher as it was during the same period last year, 56% reported their employment was unchanged, and the remainder indicated a slight decline.
In consumer spending, reports from general retailers were also mixed, the report said. Most contacts reported sales at or above 2014 levels in the most recent quarter. However, many of these contacts indicated that sales fell short of their expectations. Still, the majority of respondents have a somewhat optimistic outlook.
However, the majority of auto dealer contacts indicated an increase in sales since the beginning of July compared with the same period last year, and many expect the trend to continue through the fourth quarter.
In the manufacturing sector, activity has been mixed since the previous report as new orders were unchanged. According to the survey, a majority of manufacturing managers noted that orders have been short of expectations during the third quarter. Expectations for new orders in the next quarter were similarly mixed.
On the bright side, residential real estate activity continued to expand at a steady pace. June year-over-year home sales increased 7% in Little Rock with monthly single-family building permits spiking 34% in the state’s largest city.
A survey of Eighth District banks showed improvement in overall lending activity over the past three months. Loan demand was stronger, especially for residential mortgage and commercial and industrial loans. District crop conditions have been mixed since our previous report. Conditions deteriorated slightly for corn and soybeans but improved for cotton and rice.