Beige Book reports expanding economy in first quarter

Consumer spending

Retail and auto sales increased in April and the first three weeks of May, compared to the year before.

About 58 percent said sales levels met their expectations, 37 reported sales below their expectations and 5 percent reported sales that exceeded their expectations. About 63 percent of retail contacts said inventories were at desired levels, while 33 percent said inventories were too high.

About 46 percent of car dealers said April sales and the first three weeks of May were up, and about the same percentage reported sales were down, but by a smaller amount.

Manufacturing and services

Several manufacturers said they plan to open plants and expand operations in the near future, but a larger number of contacts said they plan to close plants or reduce operations.

The services sector continued to grow steadily, with health services and air transportation industries reporting plans to expand, and support services firm said they plan to hire more workers. The trucking industry reported a decline in outbound and inbound tonnage.

Real estate and construction

Residential construction declined throughout most of the district, and single-family housing permits in metro areas for the year-to-date from last year. By contrast, commercial real estate market conditions remained favorable throughout the district, with many contacts reporting plans for industrial parks and commercial projects.

Banking and finance

There was little change in overall lending activity in the first quarter, as credit standards and demand for commercial and industrial loans were unchanged for large and small firms.

Credit standards for commercial real estate ranged from unchanged to somewhat tighter, while demand for those loans was unchanged. Credit standards for consumer loans were unchanged, but demand for those loans was moderately weaker.

Agriculture

Frost damage in early April led farmers to harvest winter wheat for hay or destroy their crops to plant something different. More than half of the winter wheat in Missouri is in poor condition. Planting of the major crops in the district is ahead of its five-year average pace except in Missouri, where corn, soybeans and sorghum planting is behind.