Fed: U.S. economic activity has weakened since mid-October

Special Report:Global Financial

Crisis

WASHINGTON, Dec. 3 (Chinese media) -- The U.S. economy has

weakened since mid-October as the worst financial crisis in decades, which is

ongoing as of December, damps consumer spending and business investment, the

Federal Reserve said Wednesday in its latest survey on business conditions

around the nation.

"Overall economic activity weakened across all

Federal Reserve districts" since the last report, which was issued on Oct. 15,

the Fed said in the survey, the so-called Beige Book.

Districts generally reported decreases in retail

sales, and vehicle sales were down significantly in most districts, according to

the survey, which is based on economic information supplied by the Fed's 12

regional banks and collected before Nov. 24.

The survey showed that tourism spending was subdued

in a number of districts, it said, adding that reports on the service sector

were generally negative.

Manufacturing activity declined in most districts and

new orders were soft.

Nearly all districts reported weak housing markets

characterized by reduced selling prices and low, but stable, sales activity.

Meanwhile, commercial real estate markets declined in most districts.

In addition, lending contracted, with many districts

reporting reductions in residential, commercial and industrial lending and

tightening lending standards.

Agricultural conditions were mixed with a relatively

good harvest but concerns about profitability. Mining and energy production and

exploration started to soften due to lower output prices.

At the same time, the Fed's survey suggested that

businesses have little appetite to hire.

"District reports generally described labor market

conditions as weakening," it said.

But wage pressures were largely subdued. District

reports characterized price pressures as easing in light of some decreases in

retail prices and declines in input prices, particularly energy, fuel, and many

raw materials and food products.

The survey summarizes comments received from business

and other contacts outside the Fed and is not a commentary on the views of Fed

officials.

However, information from the survey will figure into

discussions at the Fed's next policy-making meeting to be held later this

month.