WASHINGTON — U.S. economic activity was generally weak in April and May across the country, according to the Federal Reserve’s Beige Book report released Wednesday.
This story first appeared in the June 12, 2008 issue of WWD. Subscribe Today.
Seven out of the 12 districts tracked in the anecdotal report cited stagnant or declining economic activity. Four districts reported “slower, sluggish or modest economic growth” and three districts reported “softer, weaker or lower” levels of commerce.
The remaining districts, including Philadelphia, Cleveland, Atlanta, St. Louis and San Francisco, said their economies were stable or had only slightly changed.
“Consumer spending slowed since the last [Beige Book] report, as incomes were pinched by rising energy and food prices,” the report stated.
Retail sales reports in New York and Boston were mixed. The pace of sales in San Francisco, Dallas, Philadelphia, Minneapolis, Atlanta, Richmond, and St. Louis slackened and flat sales were reported in Chicago, Cleveland and Kansas City.
Some retail inventory levels at specific types of stores in San Francisco were up. Atlanta reported generally higher inventory levels across the board. Retailers in New York, Richmond and St. Louis also expressed concern about their inventory levels.
“[Boston] retailers say they see clear evidence that consumers are scaling back their spending, and the majority of respondents complain that the media’s ‘doom and gloom’ portrayal of the economy contributes to such cutbacks,” the Beige Book said.
While New York district retailers were close to plan and even with last year, retailers in New York City reported especially strong numbers. But one major chain said higher wholesale costs would drive a “sizable increase in apparel prices in the upcoming season.”
So far, price increases have been mostly for nonapparel items, like food. The only district that reported higher vendor prices was Cleveland, where they were limited to food, paper products and fuel surcharges.