WASHINGTON — Holiday shopping, strong auto sales and a recovering housing market helped the U.S. economy from the middle of November through early January, according to a Federal Reserve survey released Wednesday.
The Fed said all 12 of its regional banking districts reported “modest or moderate” growth in the final weeks of 2012.
The New York and Philadelphia districts “rebounded from the immediate impacts of Hurricane Sandy” while Boston, Richmond and Atlanta reported that growth increased slightly in their districts. Yet, the report said that “labor market conditions remained mostly unchanged in all districts.”
The St. Louis district, which includes Arkansas, also saw modest growth since the Fed’s previous survey, which covered October through early November.
The Fed said plans for manufacturing have been negative in the St. Louis district, but that firms producing small arms and medical devices reported plans to expand and hire new workers. Auto dealers in Little Rock and Louisville reported increased sales for the year.
The report also said home sales increased, with November year-to-date home sales rising 16 percent in Louisville, 5 percent in Little Rock, 13 percent in Memphis and 19 percent in St. Louis.
Permits for new houses, compared with the same period in 2011, rose 40 percent in Louisville, 26 percent in Little Rock, 30 percent in Memphis and 25 percent in St. Louis.
“Housing is becoming a bright spot for the economy,” Jeffrey Mezger, chief executive officer of Los Angeles-based homebuilder KB Home, said on an earnings call in December. “The industry is once again positioned to play its historical role of being a job creator and leading the national economy into a full recovery.”
Consumers increased spending at the end of the year in every district. Auto sales were steady or stronger in 10 districts. Home sales increased in nine districts. Andhome building expanded in all but one.
Still, employers in some parts of the country delayed hiring because of uncertainty over the federal budget negotiations. Congress and the White House reached a deal on Jan. 1 to prevent sharp income tax increases from hitting most Americans. But they put off decisions on government spending cuts.
The report, called the Beige Book, provides anecdotal information on economic conditions through Jan. 4. The information collected by the regional banks will be used as the basis for the Fed’s policy discussion at the Jan. 29-30 meeting.
Many economists believe the Fed will take no new steps at that meeting.
The Fed last month said it planned to keep its key shortterm interest rate at a recordlow even after unemployment falls close to a normal level - which it said might take three more years.
And it said it would keep buying $85 billion a month in Treasurys and mortgage bonds to try to keep borrowing costs low and encourage more spending.
The economy has shown some signs of improvement in recent months. But unemployment remains high at 7.8 percent.
Job growth has been modest but steady. In December, employers added 155,000 jobs, roughly matching the monthly average in 2011 and 2012.
Wage growth has been weak. But at the same time, consumers are seeing little inflation.
Retail spending grew in December from November, led by higher sales of cars, furniture and clothing. Still, many consumers are likely to pull back on spending at the start of the year because lawmakers and President Barack Obama allowed a two-year reduction in Social Security payroll taxes to lapse.
Information for this article was contributed by Joshua Zumbrun and Aki Ito of Bloomberg News.
Business, Pages 25 on 01/17/2013