A positive outlook from the Beige Book

The Beige Book has been released as prepared by Federal Reserve Bank of Chicago.

The key takeaways in the headlines are bullish for the U.S. economy. Manufacturing increased in most districts while consumer spending increased modestly in most districts as well. Labor market conditions continue to strengthen. Credit conditions improved in most districts while lending environment, competitive, margins, compressed.

Construction and real estate activity generally expanded in late February and March, and contacts across Districts maintained a positive outlook for the rest of the year. Agricultural conditions were mixed across the Districts.Natural resource reports ranged from mixed to negative across Districts. Oil and gas production continued to fall in Atlanta.

Wages increased in all but one District (Atlanta), and several Districts reported signs of a pickup in wage growth over the last survey period. New York, St. Louis, Minneapolis, and San Francisco reported moderate wage growth, while wage pressures were characterized as mild in Chicago, mostly contained in Kansas City, and stable in Atlanta. The strongest wage pressures were for occupations where labor shortages are pressing and turnover is elevated.

Districts reporting on inventories indicated they were generally in line with sales. Capital spending increased in most districts with scattered reports of capital spending for capacity expansion.