Economic activity strengthened modestly across most of the 12 Federal Reserve districts during February and likely would have done better if not for heavy snowstorms that battered many areas.
Economic conditions continued to expand since the last report, although severe snowstorms in early February held back activity in several districts, said the so-called Beige Book summary prepared by the Kansas City Fed.
The pace of layoffs slowed but hiring plans were generally soft, according to the survey which also said wage and price pressures were muted except for commodities such as lumber and raw materials that were moving up.
The Beige Book is an anecdotal summary of conditions within the 12 districts across the country that together make up the U.S. Federal Reserve. The latest one is based on data collected by February 22, a period that included periods of severe winter weather across much of the country.
The survey findings are taken into consideration by Fed governors when they gather to set interest-rate policy.
It said manufacturing activity gained steam in most districts, especially for high-tech equipment, autos and metal industries. There also was some reported improvement in consumer spending, though weather again dampened shopping in some districts.
Real estate markets were problematic. While residential markets firmed up in several districts, most described commercial real estate and construction activity as weak or still in decline.
The banking sector also was soft, with demand for loans still weak across most of the country and banks wary about lending. Atlanta reported that banks had ample liquidity but were reluctant to reduce cash reserves, the Beige Book said in a typical commentary on activity in the sector.
Aside from commodities, companies in most districts were optimistic that price pressures were unlikely to develop soon, which may help the Fed keep interest-rate levels low for an extended period. Districts generally expected stable prices overall heading forward, the Beige Book said.
(Reporting by Glenn Somerville; Editing by Chizu Nomiyama)