Fed reports 'modest' improvement in Carolinas

The Federal Reserve's Richmond district, which includes the Carolinas, saw "modest" increases in economic activity and employment, the central bank reported in its latest roundup of regional conditions.

That was a shade slower than the "moderate" improvement seen in other regions.

The report, known as the Beige Book, showed that overall economic expansion improved nationwide in January and early February, with stronger manufacturing and tourism. The Richmond and Atlanta regions, however, were the only two with "softer" retail sales.

The Fed's researchers gather anecdotes from bankers, real-estate agents, temp agencies, business owners and others to put together the report, which provides a snapshot of the national and regional economies.

The report is released two weeks before meetings of Fed policymakers, who use the report as they consider interest rates and other factors that can effect economic growth.

Some highlights from the latest Richmond report:

-- A banker in North Carolina noted a marked pick-up in consumer borrowing, mostly with respect to credit card usage, but added that many consumers were paying down debt.

-- Commercial real estate experienced broad-based, but moderate improvement across the District over the last six weeks. Many contacts cited an uptick in activity leading to the closing of office, industrial and retail deals.

-- Temporary employment agencies gave generally optimistic reports on recent demand for workers and were upbeat about future demand. ... The branch manager of a temp agency in Raleigh reported that several manufacturing customers had hired his clients for full-time positions.

-- This is the off season for Mid-Atlantic beach rentals; however, a contact there reported that advance rentals rose since our last report, pushed by "value-added" incentives, such as price guarantees. The contact indicated that tourists were still dining out, but were more likely to use coupons, and that some high-end restaurants were "feeling the pinch."

Read today's full report on the Richmond district here.