Bloomberg News (6/9, Zumbrun) reports, “The Federal Reserve said the economy expanded at a ‘steady pace’ in most of the US while slowing in four of 12 regions as consumers contended with higher food and fuel prices and shortages of parts reduced auto production.” The Fed’s Beige Book reports “indicated that economic activity generally continued to expand since the last report, though a few districts indicated some deceleration,” the agency said, noting that manufacturing “continued to expand in most parts of the country,” while other factors like consumer spending and employment were either “mixed” or showing slow improvement. John Canally, of LPL Financial Corp said the results show the economy is “by no means booming, but it does sound like the temporary factors are a big part of what we saw in the data the last six weeks.”
The AP (6/9) reports that the Beige Book reports were “the weakest survey since fall, when two regions failed to grow at all. And it confirmed a slew of recent data that portray a national economy whose growth has faltered.” However, the AP notes, “many economists agree with comments Fed Chairman Ben Bernanke made Tuesday,” when “he suggested that the slowdown from high gas prices and Japan’s crises is temporary and that growth should pick up later this year.” The AP (6/9, Rugaber) also provides highlights of the reports from the 12 regional bank districts.
Under the headline “Fed Report Finds Cause For Optimism,” the Wall Street Journal (6/9, Lahart, Subscription Publication) reports that some analysts had expected deeper economic weakness to be highlighted in the Fed’s report. And while “a few Districts indicated some deceleration,” as the report says, experts say that the temporary nature of many of the hurdles, such as supply chain disruptions from the disasters in Japan that are now normalizing again, is reason to expect continued improvement through the rest of 2011. Like the AP, the Wall Street Journal (6/9, Bater) highlights details from the 12 regional bank districts.
From SME Daily Executive Briefing 6/9/2011