WASHINGTON (AFP) — The US economy is struggling on several fronts, with housing, manufacturing and retail activity losing steam, the Federal Reserve said in its Beige Book survey Wednesday.
The report, to be used at the upcoming central bank policy meeting March 18, said growth "has slowed since the beginning of the year."
It also cited "upward pressure on prices from rising materials and energy prices," a sign of inflation that is complicating the job of the Fed in trying to re-ignite growth.
The central bank has aggressively brought down interest rates in the past six months, with the federal funds rate now at 3.0 percent. Many analysts expect a further cut this month by the Federal Open Market Committee.
The survey from the 12 regional Fed banks indicated weakness spreading from the troubled real estate market to other sectors.
"Two-thirds of the districts cited softening or weakening in the pace of business activity, while others referred to subdued, slow or modest growth," the report said.
"Retail activity in most districts was reported to be weak or softening, although tourism generally continued to expand."
In a sign of troubles facing the financial sector, the Beige Book said most districts cited "tight or tightening credit standards and stable or weaker loan demand."
The Beige Book was consistent with many private economists' views that the economy is sputtering. Some analysts say a recession is her or on the way, although the Fed made no comment on this.
The report appeared more downbeat than the Beige Book from mid-January. It said several regions saw declines in sales of big-ticket items, a poor sign for manufacturing.
It said reports from the district banks on manufacturing "were mixed, but on the whole, subdued." Weakness was hitting manufacturing related to housing and automobiles especially hard, it noted.
In housing, which has been the leading factor in the economic slowdown, the reported said the troubles are not over.
"Residential real estate markets were generally weak over the last couple of months," it noted.
In some areas, the Fed cited "drops in home sales of more than 20 percent year over year." Prices were generally weaker also, with the exception of apartments in New York's Manhattan borough, which saw a five percent rise in prices.
The banking sector is being hurt by an increase in mortgage delinquencies, tight credit standards and in some areas "a worsening of overall loan quality."
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