The US economy showed signs of faster growth during the past six weeks, including a pickup in manufacturing, the Federal Reserve said in its survey of regional economies.
"Reports from the twelve Federal Reserve districts provided additional signs that the pace of economic activity increased a notch during June and the first half of July," according to the report, known as the beige book. The survey found "generally more positive assessments of current economic activity" and "increased optimism about economic prospects in coming months." Eight of the 12 regional banks reported "somewhat stronger growth," the survey said.
"Nascent signs of a recovery emerged in manufacturing" as 10 of the Fed's 12 districts reported "mixed, steady or slightly improved conditions after an extended period of declines," the beige book said.
Still, the report said that consumer spending was "lackluster" and prices were "little changed," a condition that puts press on corporate profits.
Central bank policy makers will use the collection of economic anecdotes when they meet to set interest rate policy Aug.12. The Fed last month lowered its benchmark overnight bank lending rate to 1 percent, a 45-year low.
The beige book "paints a somewhat upbeat picture of economic growth but the improvement that it's suggesting falls well short of suggesting a robust growth pace," said Conrad DeQuadros, an economist at Bear Stearns Cos. in New York.
Just yesterday, the Conference Board said that US consumer confidence declined unexpectedly in July to the lowest in four months as Americans' view of their job prospects sank to the weakest in almost a decade.
The beige book dovetailed with recent comments from Fed officials, who predicted a stronger recovery.
Fed chairman Alan Greenspan earlier this month told lawmakers there are "tentative signs" the long slump in business investment is coming to an end.
In turn, a revival would "tend to further boost incomes and output," he said.
Industrial production rose for a second month in June, as durable goods orders surged the most since January, helped by spending on new capital equipment. Regional factory indexes from Chicago, New York, and Philadelphia have signaled growth the past two months.
"Price and wage inflation remained broadly in check" outside of health care, energy, transportation and insurance, the Fed said. Greenspan said the central bank is prepared to hold rates low, or push them lower, to avoid an unwelcome fall in inflation or a drop into deflation.
"There's nothing in the report that provided any support for the emergence of deflation pressure," said DeQuadros.
The core consumer price index, which excludes volatile food and energy costs, unchanged since last month.
The inflation gauge was up just 1.5 percent from June of last year. That matched April's 12-month change, which was the smallest since 1966.
The Federal Reserve Bank of Richmond prepared the report based on information collected before July 21.
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
STATE OF THE NATION: The legislature should invite the president to deliver an address every year, the TPP said, adding that Lai should also have to answer legislators’ questions The Chinese Nationalist Party (KMT) yesterday proposed inviting president-elect William Lai (賴清德) to make a historic first state of the nation address at the legislature following his inauguration on May 20. Lai is expected to face many domestic and international challenges, and should clarify his intended policies with the public’s representatives, KMT caucus secretary-general Hung Meng-kai (洪孟楷) said when making the proposal at a meeting of the legislature’s Procedure Committee. The committee voted to add the item to the agenda for Friday, along with another similar proposal put forward by the Taiwan People’s Party (TPP). The invitation is in line with Article 15-2