The Eleventh District economy expanded at a moderate pace over the past six weeks. Manufacturing activity was flat to up, demand for business services rose and transportation services activity was mixed. Energy activity remained strong, and the housing sector continued to improve. Retail sales rose moderately, and auto sales were strong. Loan demand picked up since the last report. Drought conditions improved. Most firms reported no change in selling prices. Employment levels were steady to slightly higher, and wage pressures remained minimal. Most firms' outlooks are optimistic, although many respondents expressed concern about U.S. political uncertainty and the European debt situation.
Most responding firms said prices were unchanged, although some noted that input prices ticked up slightly. Retailers said selling prices were stable, although food prices increased. Auto dealers said prices were unchanged. Transportation service firms expect lower energy surcharges by July due to recently reduced prices for jet and diesel fuel. In contrast, airlines expect a slight upward trend due to higher fuel costs compared to last year at this time. Agricultural producers noted lower commodity prices and input costs.
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