Fed's Beige Book: Midwest contraction

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Whereas some industries experienced substantial drops in activity duringg the pastsix weeks, modest increasez in other sectors led the Fed to characterizee the Ninth District’s contraction as The Ninth Federal Districty includes Minnesota, Montana, Nortyh Dakota, South Dakota, the Upper Peninsula of Michigan and northwestern Wisconsin. Consumer spending and tourism werestill weak, but had “improvecd somewhat from the previous few months,” according to the Fed. The servic sector continued to experience decreased employment and profits compared to ayear ago, and furthetr profit contraction is likely.
The Fed characterized the commercia l real estate sector as adding that residential construction continuedd at steadilylow levels. The residential real estated market did see more activithy than in the previousreporting period. Manufacturiny continued its slide, as did energy and However, some wind energy projects continue to move and gold mines areat “neae capacity production.” Labor markets continued to Job cuts in Minnesota, many of them in the health care and medical-devicd fields, were cited by the Fed in its assessmenf of labor conditions. Wage increases were modest, and firms surveyedd by the Fed expect toincreasr employees’ wages by 1.
8 percen t over the next Price increases, however, were “subdued,” with the rising cost of gas a notabls exception, the Fed reported. The Fed’s next Beige Book reportr is dueJuly 29.