U.S. economic recovery slow and modest, but some sectors struggling: Fed survey

Slideshow ( 2 images )

(Reuters) – The U.S. economy continued to recover at a slight to modest pace through early October as consumers bought homes and increased spending, but the picture varied greatly from sector to sector, the Federal Reserve said on Wednesday.

The Fed’s survey was conducted in its 12 districts from September through Oct. 9.

“Districts characterized the outlooks of contacts as generally optimistic or positive, but with a considerable degree of uncertainty,” the Fed said in its anecdotal survey of businesses.

After declining from late July to early September, coronavirus infections are on the rise again in the United States. Thirty-four out of 50 states have seen new cases increase for at least two weeks in a row, up from 29 the prior week, according to a Reuters analysis here.

Cooling temperatures may usher more consumers indoors, potentially leading to more cases. Restaurants and other businesses that benefited from outdoor seating over the summer months may also face another setback if customer traffic slows.

House Speaker Nancy Pelosi, a Democrat, reiterated Wednesday she was “optimistic” that Congress can hash out another aid package to help struggling households and businesses before the Nov. 3 election, but doubts linger whether Republicans will get on board.

Fed policymakers pledged at their September meeting to keep interest rates near zero until inflation is on track to stay moderately above the central bank’s 2% target for some time and until the labor market is closer to full employment. Officials are set to meet again shortly after the presidential election, concluding their next gathering on Nov. 5.

Source: Read Full Article