Federal Reserve: Economy continues to expand in all of U.S.
July 12, 2017
• The West seeing stronger growth than other parts of the nation
• California’s housing market singled out
Economic activity expanded across all of the U.S. in June, with the pace of growth ranging from slight to moderate.
In the nine western states covered by the Federal Reserve Bank in San Francisco, economic activity expand at a moderate pace. Overall price inflation was flat, while upward wage pressures strengthened.
Sales of retail goods were modest, and growth in the consumer and business services sectors remained strong in the West.
Conditions in the manufacturing sector improved and activity in the residential housing market was robust. Conditions in the financial services sector remained solid.
The majority of Federal Reserve Districts expect modest to moderate gains in the months ahead.
While consumer spending appears to be rising across a majority of Districts, led by increases in nonauto retail sales and tourism, many Districts noted some softening in consumer spending, particularly in auto sales, which declined in half of the Districts, the Fed says in its Beige Book report Wednesday.
Other national highlights include:
• Manufacturing and nonfinancial services activity continued to grow, with most Districts reporting modest to moderate gains since the last report.
• Loan demand was steady to increasing in most Districts.
• Residential and non-residential construction activity was flat to expanding in most Districts. Most Districts cited low home inventory levels in certain market segments, which were constraining home sales in many areas. One contact in California reported extremely high presales in the residential market.
• Agricultural conditions were mixed across the nation as moisture conditions varied considerably; several Districts continued to report weakness in dairy and some crop sectors due to low prices.
In the Central Valley of California, yields of nuts and row crops were up over the previous growing season. Ample water supplies boosted cherry harvests. On balance, improved global economic conditions nudged up demand for some agriculture products, particularly pork. Increased global production pushed raisin inventories higher, reducing profitability for some growers.
• Energy activity generally improved since the last survey, particularly for oil and natural gas. Coal production remained sluggish although higher than year-ago levels.