Page last updated at 19:53 GMT, Wednesday, 10 June 2009 20:53 UK

US economic activity 'still weak'

Shoppers hold bags in Santa Monica, California
US retail spending remains weak

US economic activity remains weak but some areas of the country saw signs that the decline was beginning to ease, the US Federal Reserve says.

The Fed report said that economic conditions were weak or deteriorated further although five regions said the downward trend was moderating.

It added that labour markets were not recovering, with wages flat or falling.

The report, known as the beige book, is based on a survey of regional Fed banks and it is compiled eight times a year.

The latest report covered the period from mid-April to mid-May.

"Contacts from several districts said that their expectations have improved, though they do not see a substantial increase in economic activity through the end of the year," the beige book report said

The reported indicated the retail spending remained weak, with consumers steering clear of luxury items and new car purchases.

Comments on the housing market were more optimistic, with New York, Philadelphia , Cleveland, Richmond, Chicago, Kansas City and San Francisco districts reporting more home sales.

The Fed will meet next on June 23-24 to decide on whether to take extra measures to bolster the economy.

It has already cut interest rates to a historic low and announced a $1.2 trillion programme to spur the economy by purchasing government bonds to get more money circulating in the economy.



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