Fed survey: Housing lifts growth in most US regionsBy MARTIN CRUTSINGER
THE ASSOCIATED PRESS | October 15,2012WASHINGTON — Stronger housing markets helped boost economic growth at the end of the summer in nearly every region of the United States, according to a Federal Reserve survey.
The Fed said in the report issued last week that growth improved in 10 of its 12 regional banking districts from mid-August through September, while leveling off in one region and slowing in another. Rising home sales helped lift home prices in most districts.
The report, known formally as the Beige Book, also cited an increase in auto sales in most parts of the country. Still, consumer spending was flat or up only slightly in most districts. Manufacturing activity was mixed, with half of the districts reporting slight improvement since the previous Fed report. And hiring was unchanged in most districts.
Sal Gauatieri, senior economist at BMO Capital Markets, said the August report represents a subtle shift in the central bank’s outlook. The economy improved to growing “modestly,” he noted, from growing only “gradually” in the previous report.
The Beige Book provides anecdotal information on business conditions around the country. The information collected by the Fed’s 12 regional banks will be used as the basis for the Fed’s policy discussion at the Oct. 23-24 meeting.
Economists expect no major moves at the meeting because the Fed adopted aggressive new policies in September.
The Fed is buying mortgage bonds to lower longer-term rates, which could spur more borrowing and spending. And the Fed plans to keep short-term interest rates near zero until at least mid-2015, even after the recovery shows signs of strengthening.
By making borrowing cheaper, the Fed hopes to fuel the modest housing recovery. When home prices rise, people tend to feel wealthier and spend more freely. Consumer spending drives nearly 70 percent of economic activity.
The Fed report noted that oil production hit a record high in South Dakota, while the Minneapolis, Kansas City and Dallas districts also saw robust gains in energy production. The Atlanta and Richmond districts reported record levels for port activity in their regions.
The drought continued to weigh on farm activity in the Chicago, Minneapolis, Kansas City and Dallas districts. Dallas and Chicago reported that recent rains had improved the outlook in those districts.MORE IN National / World BusinessFebruary proved to be a strong month for U.S. stocks, even though it ended in downbeat fashion. Full Story
- Most Popular
- Most Emailed
- RICHARD'S POOR ALMANACK: On this day in 1843, British Naval officer GEORGE LORD PAULET obtains provisional cession of Hawaiian Islands; 1866, miners claim Calaveras skull found found in goldmine is remains of 5 million-year-old Pliocene man.
- RICHARD'S POOR ALMANACK: On this day 1739, 'Richard Palmer' identified in prison at York Castle as the notorious outlaw DICK TURPIN; IN 1836, Battle of the Alamo begins near San Antonio de Bexar, Texas; 1896, the Tootsie Roll invented by LEO HIRSCHFELD.
- RICHARD'S POOR ALMANACK: On this day in 1472, Orkney, Shetland islands put up as collateral by Norway to Scotland in lieu of dowry for MARGARET OF DENMARK on her marriage with JAMES III, king of Scotland; 1962, JOHN GLENN first American to orbit Earth.
- TOMORROW'S HEADLINES TODAY: City mayoral candidates debate campaign issues; Hartford, Conn., woman still missing; Neal Goswami reports attempts to legislate suicide; local woman loses 100 pounds through TOPS program.
- RICHARD'S POOR ALMANACK: On this day in 1878, JOHN TUNSTALL murdered near Lincoln, New Mexico, by the outlaw JESSE EVANS; in 1930, ELM FARM OLLIE first cow to fly in aircraft, first to be milked airborne; 1955, nuke test WASP; '79, snow in Sahara.
- TOMORROW'S HEADLINES TODAY: Rutland Herald News Editor Alan J. Keays and staff writer Gordon Dritschilo discuss stories planned for the February 18, 2015, edition of the newspaper: Winter budgets maxed, legal marijuana, Springfield bank job, USPS slowdown