U.S. Economy Shows Signs Of ‘Softening’

U.S. economic activity remained at a high level, but “some softening” was reported in many parts of the country, the Fed said Wednesday in its Report on Current Economic Conditions.

Activity in interest-sensitive sectors, such as housing, remain well below their year-ago levels, the Federal Reserve said in its “beige book.” The Midwest reported the strongest growth, with economic conditions less favorable on the two coasts.

In the San Francisco district, which includes Washington, the pace of growth slowed. Retail sales were sluggish, especially for autos.

Single-family housing construction was below 1994 levels in most areas. Manufacturers of building materials reported declines. But manufacturers of metals and electronics said demand was strong.

Tourism also showed strength. Farm exports generally were strong, despite sluggish sales to Mexico. Loan growth picked up.