WASHINGTON – Economic conditions continued to expand from January to early February, according to the Federal Reserve on Wednesday, citing data from its 12 regional or district banks. It notes that California’s drought is beginning to be felt in business decisions.
New York and Philadelphia experienced a slight decline in activity, which was mostly attributed to the unusually severe weather experienced in those regions. Growth slowed in Chicago, and Kansas City reported that conditions remained stable during the reporting period.
The outlook among most Districts remained optimistic.
In the West, economic activity expanded at a moderate pace during the reporting period of late December through mid-February, says the 12th District Federal Reserve Bank, based in San Francisco.
Price increases for most final goods and services were minimal, and wage gains remained quite modest on net, it says.
The pace of retail sales stepped down, although demand for business and consumer services rose. District manufacturing activity was mixed.
Production activity in agricultural and resource-related industries expanded on balance.
“Concerns about water costs and availability may cause farmers in the California Central Valley to scale back planting. Contacts expect growers to allocate water to more permanent plantings, such as almond and walnut orchards, before allocating water to annual crops, such as corn,” the Beige Book report says.
“In addition, dairy and meat producers may face higher feed costs due to water shortages.”
Year-over-year crude oil production increased robustly, although consumer demand for petroleum and gasoline rose more modestly, it says.
Activity in residential and commercial real estate markets continued to expand.
Financial institutions reported that loan demand increased overall.
Full story by Central Valley Business Times at centralvalleybusinesstimes.com.
