Economic activity weakened across all the Federal Reserve districts, according to the Fed’s Beige Book released yesterday.
Declines were noted in retail sales, particularly motor vehicles. Discount stores reported stronger sales volume than department stores, with decreases reported for big-ticket items. Inventories were stable, and most retailers are prepared for relatively soft holiday sales.
Manufacturing activity fell further, with “soft” new orders. Service sector activity also fell. Housing markets remained weak, with falling prices and activity stable at a low level. The commercial real estate market also contracted, and as result both residential and commercial lending contracted.
Banks tightened lending standards. Overall price pressure continued to ease, while wage pressures remained subdued due to weakening labor markets. The decline in energy prices has reduced mining and energy production and exploration.