(Updates to add details on regional activity and economist comment.)
WASHINGTON -(Dow Jones)- The U.S. economy continued to improve across much of the country last month, the Federal Reserve said in a report released Wednesday.
The Fed in its Beige Book said overall economic activity rose in 11 of its 12 districts between the end of February and April 5. St. Louis was the lone Fed district to report that economic activity had softened during the period.
The St. Louis Fed district extends from Arkansas into Kentucky.
In the St. Louis area, more manufacturing plants closed than opened and even temporary Census employment couldn't rally the services sector.
"Several manufacturers reported plans to consolidate operations and lay off employees, including firms in the appliance; heating, ventilation, and air conditioning; steel; and machinery manufacturing industries," the Fed said.
Across much of the rest of the country, however, manufacturing activity, retail sales and tourism spending rose while consumers appeared to be more confident.
"Managers at mountain resorts in the Richmond District reported that this winter was one of their best ski seasons ever," the Fed said in its report.
Looking north, the Fed said, "New York and Minneapolis noted that shopping by Canadians was strong at businesses near the border."
Several districts reported an increase is housing market activity. In Atlanta, for example, builders reported improved new home sales across the region.
The commercial real estate sector, however, remained weak across most of the country. But Richmond saw commercial leasing activity increase and Fed's contacts in Dallas believed the area commercial real estate woes were nearing bottom.
Class A office rents in Manhattan were down by 20% to 25% on an annual basis in March, the Fed noted.
Other weak points lingered in the economy, too. "Loan demand is still shrinking, and credit quality is still deteriorating," Steven Wood, chief economist for Insight Economics, wrote in a note.
But in one sign of thawing in labor markets, several of the Fed's districts reported an increase in the hiring of temporary workers.
"Cleveland, Richmond, Atlanta, and Chicago reported strong demand for temporary workers," the Fed said.
In Richmond, "one temporary agency reported that clients were now filling positions that had been eliminated at the depth of the economic downturn."
Some workers also may begin to see more money in the paychecks, the Fed's contacts suggested.
"Most New England employers are no longer shedding workers, and many are restoring recession-induced cuts in wages and benefits," the report said. "Dallas reported that just a handful of firms were planning on partially reinstating employer matches to retirement plans or giving small pay increases."
The overall labor market, however, remained weak, the Fed noted.
Copyright 2009 Dow Jones Newswires
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