Fri, Jun 12, 2009 - Page 1 News List

US economy’s sharp downward trend is easing, Federal Reserve report says

AP , WASHINGTON

Travel and tourism activity dropped as vacationers spent less.

Business at Manhattan hotels and Broadway theaters fell last month after a modest increase in April, the report said. The San Francisco region reported “pronounced” declines in occupancy rates, especially in luxury hotels. However, bookings at resorts in the Richmond region are starting to pick up and the Minneapolis region saw indications that summer reservations at campgrounds and resorts are “strong.”

On the housing front, the residential market remains weak, but there were some positive signs. Real-estate agents in eight of the 12 regions -— New York, Philadelphia, Cleveland, Richmond, Chicago, Kansas City, Dallas and San Francisco -— reported an “uptick in home sales.” Low interest rates, declining home prices and tax credits for first-time home buyers were cited as factors in the improvement.

Much of the increase in sales was found in the lower-priced end of the housing market.

Still, commercial real-estate markets remained frail.

Weakness in the jobs market persisted nationwide, with wages generally flat or falling, the Fed said.

In manufacturing, employment stayed at low levels, although some regions saw signs that job losses may be moderating. Retail employment was mixed, with some regions like Boston and Cleveland reporting stability, while Richmond reported more reductions.

The Atlanta, Chicago and St Louis regions reported that some state and local governments faced hiring freezes or outright job cuts. Some regions mentioned employers’ plans to scale back employee benefit programs in a bid to cut costs.

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