Fed Reports Economic Variations

The nation’s economy is advancing at a slow to modest rate with substantial regional variation, the Federal Reserve Board said today in its “beige book” on current economic conditions.

The report, prepared for an Oct. 3 meeting of the Fed’s top economic policy makers, said consumer spending, construction and manufacturing activity was mixed, while agricultural conditions have continued to improve.

The findings appeared consistent with a slew of recent economic indicators that have shown the economy is in a holding pattern of modest growth and low inflation--the so-called “soft landing” scenario favored by Fed Chairman Alan Greenspan.

Economic Surveys

The report was compiled by the Federal Reserve Bank of St. Louis based on business and economic surveys conducted by the 12 district Fed banks before Sept. 12.

Many of the Fed districts in their separate summaries said growth was modest, sluggish, mixed or soft, with the direction decidedly muddled.

The 12th District of San Francisco stood alone in a report of healthy growth in the West, supported by robust consumer spending, stable manufacturing, strong exports and good crop yields. Expectations for growth are rising, it added.

Atlanta, the 6th Fed District, said the weakness in business activity has abated and expectations have brightened for the remainder of the year. The 2nd District of New York also found recent signs of strength.

In contrast, St. Louis reported sluggish growth with no change in sight, while Philadelphia said manufacturing continues to soften in a climate of modest growth.

The varied pattern of economic growth was echoed in the summary provided by the Fed in the opening pages of its report.

“Consumer spending has been mixed, but most districts report strong sales of apparel and cars recently,” the Fed said.

“Manufacturing conditions are generally satisfactory or improving in the nation’s Southern and Western regions, but some weakening was noted in New England and much of the Midwest,” it added.

In a summary of the labor market, the Fed said three districts--Boston, St. Louis and San Francisco--reported a shortage of workers.