PROVIDENCE – The New England economy continued to expand at a moderate pace from April through mid-May, according to the Federal Reserve’s Beige Book released Wednesday.
The report noted that manufacturers in New England cited mixed results despite the economic expansion, citing tariffs and the trade war as having a depressive effect on the industry. Manufacturers also cited increased costs due to tariffs, but most said they were able to pass costs on to customers.
The report noted that staffing firms remained “guardedly optimistic” in the region while manufacturers have downgraded their outlooks.
Firms in the region reported little hiring and rising wages. The staffing industry in the area said the limited applicant supply is resulting in underqualified candidates.
Prices in the region were reported to have generally remained level, with most retail contacts reporting year-over-year same-store sales growth. The report did say pharmaceutical prices have slowed to a “more moderate” increase, while prices of dairy products and eggs declined but the price of pork continued to rise.
The report noted that while commercial real estate leasing demand was robust in Boston and Portland, Maine, the Providence market remained “a bit soft.” The report noted the market was worse in Hartford, Conn. Rent prices in Providence were said to have remained level.
Construction in the region was said to be constrained by rising prices, which presented a “significant risk to activity moving forward.”
The residential market in the region was determined to be robust, with single-family home sales in Rhode Island increasing year over year much like the rest of the region, except for New Hampshire.
Rhode Island bucked the region trend with an increase in inventory recently, and also went against the regional trend of an increase in condominium sales in recent weeks. Condo inventory in the Ocean State decreased moderately, according to the report.
A contact told the Fed that homes in the region are going under contract “at a hectic pace” despite slowing price increases.
The report noted the United States economy also expanded at a moderate pace in recent weeks. The report said the outlook for the economy was “solidly positive but modest,” with little variance between the 12 districts.
Chris Bergenheim is the PBN web editor. You may reach him at Bergenheim@PBN.com.
