US: Fed’s Beige Book Finds Some Recovery In Economic Activity But “Well Below” Pre-Pandemic Levels

Four months after the May Beige Book was shocked at the economic devastation across the US, things continue to improve according to the latest assessment from various regional Fed, which said in today’s just released August edition of the Beige Book that “economic activity increased among most Districts, but gains were generally modest and activity remained well below levels prior to the COVID-19 pandemic” while manufacturing rose in most Districts – as confirmed by the latest PMI and ISM data – and which coincided with increased activity at ports and among transportation and distribution firms.

Some more details from the latest report, first looking at consumer spending and residential activity :

  • Consumer spending continued to pick up, sparked by strong vehicle sales and some improvements in tourism and retail sectors.
  • But many Districts noted a slowing pace of growth in these areas, and total spending was still far below pre-pandemic levels.
  • Commercial construction was down widely, and commercial real estate remained in contraction. Conversely, residential construction was a bright spot, showing growth and resilience in many Districts.
  • Residential real estate sales were also notably higher, with prices continuing to rise along with demand and a shortage of inventory. In the banking sector, overall loan demand increased slightly, led by solid residential mortgage activity.
  • Agricultural conditions continued to suffer from low prices, and energy activity was subdued at low levels, with little expectation of near-term improvement for either sector.


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