U.S. economy expands

The U.S. economic activity expanded at a "modest to moderate pace" from late November through the end of December, which reflects improvement in the economic conditions, the Federal Reserve indicated in a report here Wednesday. The Fed's Beige Book said that reports from the twelve Federal Reserve Districts suggest that "national economic activity expanded at a modest to moderate pace during the reporting period of late November through the end of December." It added that "compared with prior summaries, the reports on balance suggest ongoing improvement in economic conditions in recent months, with most Districts highlighting more favorable conditions than identified in reports from the late spring through early fall." It indicated that consumer spending picked up in most Districts, "reflecting significant gains in holiday retail sales compared with last year's season, and activity in the travel and tourism sector expanded in most areas." It added that demand "strengthened further" for nonfinancial services, while manufacturing activity "generally continued to expand, although the pace of growth has slowed for selected subsectors such as technology products." Also, reports from financial institutions generally indicated a "slight uptick in loan demand by businesses, along with improvements in overall credit quality." Meanwhile, upward price pressures and price increases remained "quite limited" for most categories of final goods and services, "as the effects of prior increases in the costs of selected inputs have eased," the report showed. According to the Beige Book, "the combination of limited permanent hiring in most sectors and numerous active job seekers has continued to keep a lid on general wage increases."