Recovery on ‘Modest’ Pace; Consumer Lending Weak: Fed

Fed Chairman Ben BernankeEconomic activity only “modestly” improved based on the latest input received by Federal Reserve officials from the Central Bank’s 12 districts, but consumer lending weakened in most regions.
Based on feedback from the business community and other contacts, the Fed’s Beige Book update released today continued to report an overall sluggish pace of recovery.
Consumer spending improved but continued to be “concentrated in necessities as opposed to discretionary big-ticket items.”
Business spending rose as employment and capital spending edged up, but inventory investment slowed.  Non-financial services, manufacturing, and transportation continued to gradually improve.
Real estate lending increased, though standards remained tighter than on other loans, particularly for commercial mortgages. And the lending was tied to a surge in home sales due to the homebuyer tax credits, which expired April 30.
But in the weeks since the expiration, mortgage applications have plummeted.
“Commercial and industrial lending by banks remained weak in most Districts, although Philadelphia, Chicago, Dallas, and San Francisco noted business loan demand was firming,” the Fed reported.
Moreover, “consumer lending weakened in most districts.”
Here are links to the Fed’s Beige Book summaries by district:

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