The recession is over and the economy is growing again.
That's the message implicit in the Federal Reserve's latest survey of businesses around the country, which found economic activity stabilizing or improving in most regions.
Economists warn the expansion is fragile and will have staying power only if consumers start spending more money. Rising unemployment that keeps Americans cautions could make for a plodding recovery in the months ahead.
All but one of the Fed's 12 regions indicated economic activity either was "stable," showed "signs of stabilization" or had "firmed," according to the Fed's survey. The one exception was the St. Louis region, which reported the economic decline is "moderating."
Businesses in most Fed regions said they were "cautiously positive" about the economic road ahead. The survey, known as the Beige Book, does not include precise figures.
Analysts predict the economy is growing in the current quarter, which ends Sept. 30, at an annual rate of 3 percent to 4 percent. That's mostly because businesses, which had slashed investments during the recession, are spending more, The Associated Press reports.
In the meantime, the economy in New Mexico and six neighboring states “generally held steady in late July and August,” the U.S. Federal Reserve reported Wednesday in its latest “Beige Book” survey of the region’s business executives.
Most of the Fed’s regional Beige Books nationwide echoed that theme, citing indications of a stabilizing or even improving economy across the country.
In New Mexico and neighboring states, consumer spending “was supported by seasonal and automotive incentives, while restaurant and hotel spending was subdued,” said the closely watched regional survey, which covers a period of about six weeks.
It said manufacturing activity “held steady and plant managers expected a modest rise in production in coming months,” Bizjournals.com reports.
It was also reported, despite the positive news, the regional report contained some sobering information:
• Factory output remains depressed, with half of the companies surveyed expecting no improvement this year.
• Residential construction remains weak, although sales of entry-level homes were reportedly doing well thanks to the first-time home buyer tax credit.
• Retail sales were down as consumers continued to focus on purchasing necessities.
• Coal executives reported a decline in production due to weak demand from electric utilities.
The brightest spot in the report came from auto dealers, who reported a jump in sales due to the Cash for Clunkers program.
The Federal Open Market Committee meets in Washington Tuesday and Wednesday, Pittsburgh Post Gazette reports.