U.S. economy continues to grow despite cooling in housing market: Fed

The U.S. economy will continue to grow despite a "widespread cooling" in the housing market, the Federal Reserve said in its Beige Book report Thursday.

"Reports from the 12 Federal Reserve Districts indicate that economic activity continued to expand since the last report," said the widely watched Beige Book survey, used by the central bank for its policymaking meetings.

"Four districts reported that economic growth firmed while a couple of districts noted that growth cooled," the report said. " Other reports characterized growth as moderate or mixed."

The vast services sector "generally strengthened across districts since the last report," while manufacturing activity remained "generally strong," said the report.

However, the report noted there was a "widespread cooling" in housing with the majority of the Fed's 12 regions reporting lower asking prices for homes, rising inventories of unsold homes and a softening in sales.

Labor market conditions remained taut since the last report released six weeks ago, said the report, adding inflation pressures from commodity prices including energy appeared to ease.

"Most districts reported few signs of increased price pressure in recent weeks," it said.

The U.S. economy grew by an annual rate of 2.6 percent in the second quarter, compared with a brisk 5.6 percent in the first three months of this year.

Policymakers at the Fed are scheduled to meet again on Oct. 24- 25. They are expected by many economists to leave interest rates unchanged for the third straight time.

Source: Xinhua