U.S. economic activity continued to expand at a modest to moderate pace in June and early July, the Federal Reserve said in its latest "Beige Book" summary of national activity.
However, the report revealed strains in the labor market as job growth grew at a slow pace across most of the twelve Federal Reserve districts.
Conditions are deteriorating in the eastern part of the country, with New York, Philadelphia and Cleveland districts reporting slowing growth.
The downbeat Beige Book reflects a series of disappointing jobs figures that suggest the Fed will again be called upon to give the economy a boost by easing monetary policy.
"Employment levels improved at a tepid pace for most districts," the Fed said.
Businesses responding to the Fed survey indicated concerns about the so-called "fiscal cliff" that Congress has been urged to avoid. Companies were holding back on hiring in the absence of clarity on the outlook for the economy.
Still, "Overall, districts reported that their contacts remained cautiously optimistic," the Fed said.
After months of bad news, positive signs were seen in the housing market, where rental prices were on the rise. Earlier today, government figures showed housing starts rose 6.9% to an annual rate of 760,000 last month. As buyers scrambled to lock in record-low interest rates, new construction saw the fastest rate of growth since 2008.
by RTT Staff Writer
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