Federal Reserve's Beige Book cites slowing economy

Staff -- Logistics Management, 3/6/2008

WASHINGTON—United States economic growth has decreased since the beginning of this year, according to the Federal Reserve’s Beige Book.

The Beige Book is published by the Federal Reserve eight times per year, and it collects anecdotal information on current economic conditions in its 12 Districts based on reports from bank and branch directors and interviews with key business contacts, economists, market experts, and other sources, according to the Federal Reserve. Information based on this data is summarized by sector and district. Participating Federal Reserve districts include: Boston, Philadelphia, New York, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco.

This edition of the Beige Book reported that two-thirds—or eight—of these participating districts “cited softening or weakening in the pace of business activity, while the others referred to slow or modest growth.

This reduced economic activity is in line with reports released earlier this week by the Institute for Supply Management, which indicated that U.S manufacturing activity contracted in February and the non-manufacturing sector also failed to grow in February.

The Beige Book reported that reports on the manufacturing sector were mixed but largely down, with New York, Philadelphia, Richmond, Kansas City, and Dallas indicating that production or shipments were “sluggish or falling.

And the effects of the ongoing housing crisis are still in play as evidenced by continued weak markets for products and equipment used for building and furnishing homes,” according to the Federal Reserve.

The Beige Book also reported that reports on retail spending were “generally downbeat, with retail sales described as “below plan, downbeat, weak, or having softened.”