U.S. recovery taking hold: survey

The U.S. Federal Reserve reported Wednesday that the American economic recovery broadened slightly last month, but economic activity remained "at a low level."

The survey — called the Beige Book — is done eight times a year. It is based on anecdotal accounts of economic conditions after interviews with key business leaders and market experts in each of the Federal Reserve’s 12 districts and will be widely watched for clues about whether the central bank intends to increase interest rates.

Many economists don’t expect the Federal Reserve will increase the federal funds lending rate, now between zero and 0.25 per cent, until next year, given the fragile state of the recovery. The next time the central bank could change rates is at its policy meeting Jan. 26 to 27.

The survey reported that activity in 10 of 12 regions had increased since the last report in early December, compared with a pickup in eight districts then.

Consumer spending in the recent 2009 holiday season was slightly greater than in 2008, but still far below 2007 levels, the survey found. Auto sales held steady or increased slightly since the last Beige Book in most districts.

Manufacturing increased or held steady in most districts. Home prices appeared to have changed little since the last Beige Book, and residential construction remained at low levels in most districts, the survey found.