The recession is losing force in most parts of the United States, the Federal Reserve said Wednesday in a snapshot of economic activity from across the country.þþBut the picture remains grim in other sections, with retail sales down in the Midwest, loan demand falling in New York, commercial real estate weakening and manufacturing activity stumbling in many regions. þþThe assessments were part of the Fed’s beige book, a regular assessment of economic conditions from 12 Fed districts nationwide. Since the spring, the various Fed districts have reported that things were still bad, but not hurtling downward at an accelerating pace.þþDespite stabilizing conditions over all, few businesses or industries are girding for a rebound. Manufacturers anticipate a modest and uneven recovery. Some retailers are bracing for a long, slow recovery; the job market remains dismal and is likely to stay that way for some time.þþ“The weakness of labor markets has virtually eliminated upward wage pressure, and wages and compensation are steady or falling in most districts,” the Fed said.þþWhile the broad arc of the economy tracked a similar course, this time there were a few more glints of hope. In four districts, health care companies were hiring. Information technology jobs were opening up in the Richmond and Minneapolis districts. And there were signs that New York’s labor market was stabilizing.þþAlso on Wednesday, the government reported that new orders to factories for durable goods fell sharply in June as demand for commercial aircraft and motor vehicles declined from a month earlier.þþThe 2.5 percent drop in manufacturers’ orders was the largest decline in five months, but economists said the picture was brighter than it might seem. Excluding volatile orders for transportation equipment, manufacturers’ orders rose 1.1 percent for the month, a larger increase than analysts had forecast.þþEconomists said the numbers reflected more stability in the manufacturing sector after months of declines that came as factories shut down, cut their inventories and scaled back production as they confronted the worst economy in decades. Now, manufacturing seems to be finding its footing, economists said.þþ“It tells me we’re on the cusp of a very slow and gradual recovery,” said Tim Quinlan, an economic analyst for Wells Fargo. “Businesses have been in absolute lockdown all year. Everybody has been scaling back and saving money. Orders seem to be in a bottoming process.”þþStill, new orders for all durable goods — products that last several years — were down 26.7 percent in June from a year earlier, the Commerce Department reported, and shipments of goods fell 19.5 percent.þþIn June, there were more new orders for metals, machinery, electrical equipment and appliances. Orders for military aircraft rose by 30 percent in June from a month earlier, the Commerce Department reported. þþBut declines in automotive orders, coupled with a double-digit decline in orders for commercial aircraft, weighed on the sector, demonstrating the volatility of the government’s figures on durable goods orders. þþNew orders for motor vehicles and parts fell 1 percent in June, reflecting turmoil caused by the bankruptcies of General Motors and Chrysler in addition to sagging demand for domestic automobiles. Orders for civilian aircraft plunged 38.5 percent, one month after they shot up 60 percent.þþ
Source: NY Times
