April 15, 2009
Federal Reserve Districts
|Skip to content
Sixth District business contacts reported that economic activity remained weak in March. Information from retail and auto industry contacts suggested sales declined, whereas reports on tourist activity were mixed. The outlook among commercial construction industry contacts worsened as vacancy rates continued to rise. However, residential real estate contacts noted modest sales improvements in several areas. Also, while manufacturing contacts noted that production and orders remained very low, their outlook was less pessimistic than last reported. Banking contacts remarked that business and consumer loan demand remained weak while access to credit remained tight. Labor market conditions worsened as more businesses reported layoffs. Price pressures remained subdued throughout the District.
Consumer Spending and Tourism
Reports on tourism activity in the District were mixed. Convention cancellations, lower attendance, and tighter spending patterns were negatively impacting several locations. However, cruise lines experienced strong bookings as a result of heavy discounting and promotional incentives. Visitor numbers were described as being relatively strong at some popular drive-to destinations, including several theme parks.
Real Estate and Construction
Commercial real estate activity remained weak. Vacancy rates continued to rise in many parts of the District, putting downward pressure on rents, most notably in the retail sector. District commercial contractors reported more projects being postponed. Going forward, commercial real estate contacts anticipate more space will become vacant in the coming months and that construction will continue to slow.
Manufacturing and Transportation
District transportation reports pointed to ongoing weak freight activity in March compared with a year earlier. Auto, chemical, and construction-related rail shipments declined further. Trucking contacts servicing the retail industry noted much lower tonnage than a year earlier and intense pricing pressure.
Banking and Finance
Employment and Prices
Significant price discounting was noted at the retail level, and manufacturing and construction firms continued to report that prices for both raw materials and finished goods were below year-earlier levels. Energy prices were relatively stable in March.
Natural Resources and Agriculture