Fed's Beige Book: Midwest contraction

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Whereas some industries experience d substantial drops in activity during the pastsix weeks, modesgt increases in other sectors led the Fed to characterizw the Ninth District’s contractiojn as moderating. The Ninth Federal District includes Minnesota, Montana, North South Dakota, the Upper Peninsula of Michiga n andnorthwestern Wisconsin. Consumert spending and tourism werestillo weak, but had “improved somewhat from the previou s few months,” according to the Fed. The servicw sector continued to experiencedecreased revenue, employmenrt and profits compared to a year ago, and further profit contractionh is likely.
The Fed characterized the commercial real estatw sectoras “anemic,” adding that residential construction continuec at steadily low The residential real estate markegt did see more activitt than in the previous reporting period. Manufacturing continueds its slide, as did energy and mining. some wind energy projects continu tomove forward, and gold mines are at “near capacit production.” Labor markets continued to Job cuts in Minnesota, many of them in the healthg care and medical-device fields, were cited by the Fed in its assessmen t of labor conditions. Wage increases were modest, and firms surveyed by the Fed expecty toincrease employees’ wages by 1.
8 percent over the next Price increases, however, were “subdued,” with the risingf cost of gas a notablde exception, the Fed reported. The Fed’s next Beige Book reporrt is dueJuly 29.