Fed: Economy is recovering

Julian Harris
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AMERICA’S end of year economic uptick was confirmed by the Federal Reserve beige book last night.

The report, based on anecdotal accounts from businesses across the Fed’s regional branches, painted a “positive, although still generally cautious” picture.

“Economic activity continued to expand moderately from November through December,” the report said.

“Conditions were generally said to be better in manufacturing, retail, and nonfinancial services sectors than in financial services or real estate.”

US manufacturing received a boost, as the beige book reported continued recovery in all districts.

Retailers in all districts reported an improved holiday season, compared to the previous year.

And there was even positive news for jobs growth. “Labour markets appeared to be firming somewhat, as some modest hiring beyond replacement was said to have occurred.”

Retailers and manufacturers reported the effects of rising global prices, yet competitive pressures prevented increases being passed onto consumers. Upward pressure on wages was also reported as limited. “We take this as an encouraging report,” said Barclays Capital.