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WASHINGTON: Economic activity weakened across the United States over the past several weeks with most sectors facing pressure, the Federal Reserve said in its Beige Book report on Wednesday.
The report, to be used by Fed policymakers for their December 15-16 meeting on interest rates, indicated a further decline in already grim economic conditions.
"Overall economic activity weakened across all Federal Reserve districts since the last report," the Beige Book said.
The report noted weak consumer spending and auto sales "down significantly" in most regions.
Manufacturing declined and housing remained soft, due to "reduced selling prices and low, but stable, sales activity."
The report came just two days after the National Bureau of Economic Research (NBER), the panel recognised as the official arbiter of business cycles, said the US economy has been in recession since December 2007.
The Beige Book, based on a survey of the 12 regional Federal Reserve Banks, found few bright spots in the economy.
Significantly, the report found credit conditions tightening, further choking off economy activity.
"Lending contracted, with many districts reporting reductions in residential, commercial and industrial lending and tightening lending standards," the Beige Book said.
"Credit standards rose across the nation, with several districts noting increases in loan delinquencies and defaults, especially in the real estate sector. Credit conditions remained tight."
The regional banks described labour market conditions as "weakening," with "subdued" wage pressures.
The report said price pressures were "easing in light of some decreases in retail prices and declines in input prices, particularly energy, fuel, and many raw materials and food products."
In services, which has been fared somewhat better than other segments of the economy until now, the Beige Book cited "weakness across a wide range of services, including advertising, architecture, business support, information technology, legal services and temporary help firms."
The Beige Book said the agricultural sector was "mixed" but also saw some pressures from tight credit and the bankruptcy of a large ethanol producer. - AFP/de
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