Manufacturers are also struggling because of the strong dollar, which has increased about 13 percent in value against a basket of other currencies in the past 12 months.
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According to the survey, labor markets tightened in most districts, while prices remained fairly stable across the country.
Two reports of interest to the real estate industry came out on Wednesday: retail sales numbers from the Census Bureau and the Fed’s Beige Book, formally known as the Summary of Commentary on Current Economic Conditions by Federal Reserve District.
“A number of Districts cite the strong dollar as restraining manufacturing activity as well as tourism spending; Consumer spending grew moderately in the latest reporting period.” the report said.
September’s meeting may have had a rosier economic picture, he says, than October’s will, and the Fed is on a the shot clock, having said they’d raise the rates before the end of the year.
Reports on the banking and finance sector were generally positive, it said.
The US dollar index declined against its main rivals on Wednesday as disappointing economic data lifted expectations that the Fed would continue to delay an interest-rate hike. Most districts noted improvement across all major segments, though New York and St. Louis noted a few increased slack in the market for retail space. The Beige Book will be used by the central bank in deliberations for the October interest-rate-setting meeting.
The Fed has held its benchmark federal funds rate near zero since late 2008 to help support the economy’s recovery from the worst recession since the 1930s. Eight of the 12 bank boards voted to increase the discount rate, which is applied to direct loans to banks from the Fed, up from five regional banks in August.
Meanwhile, inflationary pressure in the guts of the USA economy was invisible again in September, largely because of another drop in gasoline prices. Governor Daniel Tarullo said Tuesday he “wouldn’t expect it would be appropriate to raise rates” this year, given his outlook for the economy. 10-year note yields climbed three basis points, or 0.03 percentage point, to 2 percent as of 6:46 a.m. New York time Thursday, according to Bloomberg Bond Trader data.
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The stronger dollar has also discouraged many overseas tourists from visiting the United States by raising the cost of hotel rooms and other goods and services.
