Manufacturing activity contracted, while transportation activity was flat.
Sections of interest:
Real Estate and Construction
Residential and commercial real estate activity remained sluggish in late November and December. District home prices were flat, but most real estate contacts expected prices to rise along with home sales over the next three months. Multiple contacts reported multi-family housing as a source of strength in the housing market. Mortgage lenders reported weak mortgage demand with fewer home purchases and refinancings relative to the previous survey period. Lenders cited stricter mortgage lending requirements as a key factor underlying weak loan demand. Housing starts declined further, and expectations about future construction activity remained subdued. Construction supply firms reported weak sales over the survey period, and most expected little change in activity over the coming months. Commercial real estate sales, prices, and vacancy rates improved, and District contacts were more optimistic about the coming months. Rents on commercial properties were stable and expected to rise over the next three months. Developers reported little change in access to credit.
Almost all bankers reported generally steady loan demand, stable or improving loan quality, and increased deposits. Loan demand by category was mixed. Most respondents reported steady loan demand for commercial and industrial loans, commercial and residential real estate loans, and consumer installment loans. Remaining respondents were split between stronger and weaker demand within each of these categories. Credit standards remained largely unchanged in all major loan categories and deposits increased for the eighth straight survey. Bankers generally reported loan quality as steady or improving compared to a year ago and reported the outlook for loan quality over the next six months as steady or improving.