Weakness remains in key segments of the U.S. economy despite the continued recover, suggests the results of a survey released Wednesday by the U.S. Federal Reserve.

The latest “Beige Book” survey found that reports from the 12 Fed districts “suggest that economic activity continued to expand moderately” from November through December. It found that conditions were generally better in manufacturing, retail, and non-financial services sectors than they were in financial services or real estate. Also while certain costs were said to be rising, hiring was modest, as was wage pressure.

“All in all, most sectors of the economy appear to be improving consistently throughout the country. This is a welcomed sign, and suggests that the economic recovery is maturing on a firmer footing,” said TD Economics.

“That said, housing and credit conditions continue to lag the broader economy, which is an obstacle to faster growth,” it noted. And, it said that perhaps the most disappointing part of today’s Beige Book “was the tepid language used to describe hiring. The reality is that the U.S. labour market will require more that just ‘firming’ to lower the unemployment rate in a meaningful way.”

“The ongoing slow pace of job recovery, coupled with weak end product price pressures, suggests that the Fed will not adjust its bond purchase plan when it meets again in two weeks time,” TD concludes.

This was echoed by RBC Economics, which said, “Against this backdrop, we expect that the Fed will not make any changes to its highly accommodative monetary policy stance at its upcoming meeting.“

IE