From Fox News:
URL:http://www.foxnews.com/story/0,2933,93318,00.html
Fed: Economy Improving, Factories Looking Up
Wednesday, July 30, 2003
WASHINGTON — The Federal Reserve (search) sees signs the U.S. economy is improving, especially in the long-suffering manufacturing sector.
But a report Wednesday by the central bank said goods prices still appeared soft in much of the country and it also said there had been an unexpected jump in car inventories during June and July.
"Reports from the twelve Federal Reserve districts provided additional signs that the pace of economic activity increased a notch during June and the first half of July," the Fed said in its beige book (search), which summarizes anecdotal information the central bank receives from its business contacts around the country.
"In particular, manufacturing activity edged higher in most districts, and Philadelphia and Richmond cited an end to the recent declines in production," the Fed said.
The latest beige book report was prepared by the Federal Reserve Bank of Richmond (search) and was based on information gathered before July 21.
In public appearances and interviews, Federal Reserve officials have pointed to indications the economy may be gathering momentum.
But policymakers have emphasized the economy needs to grow at very brisk rate to stave off a downward trend in the already low rate of inflation.
Fed Chairman Alan Greenspan (search) and his colleagues are concerned about the price trend because of the risk of deflation, a broad fall in prices that could damage the economy.
The Fed said in its report that it saw "nascent signs of a recovery" in the factory sector." It said 10 out of the 12 Fed districts in the United States reported that manufacturing was either stabilizing or improving after a long slump.
"Reinforcing the view of stronger conditions in manufacturing, nine of the twelve districts were optimistic about prospects for the sector over the next six months," the Fed said. "Despite the stronger tone, prices of manufactured products remained soft." |
