Optimism for US recovery

Julian Harris
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STEADY growth is being observed in the US, the central bank reported last night.

In its latest beige book, the Federal Reserve said the economy “continued to improve, on balance” from early/mid-October to mid-November.

Manufacturing activity continued to grow in “almost all” districts, reflecting optimistic results from yesterday’s ISM manufacturing index.

The beige book found positive signs for employment. “Hiring activity showed some improvement across most Districts,” it said.

And expectations for the holiday season are high, “with several districts expecting higher sales when compared to year-ago levels.”

Yet there was also bad news for consumer spending. “Households remain price sensitive and focused on buying necessities,” the Fed revealed.

And gloom still lurks over the US housing market, which “remains depressed,” with signs in some areas of “further weakening during the past six weeks.”

Overall, however, the report was cautiously optimistic. “Anecdotal reports of the districts suggest that activity, on balance, has accelerated modestly,” said Michael Gapen of Barclays Capital Research.