Economic Activity Declined Into New Year, Fed Reports

The U.S. economy weakened across almost all regions at the end of last year, hurt by a lack of credit and declines in retail sales, the Federal Reserve said Wednesday.

“Most districts noted reduced or low activity across a wide range of industries,” the Fed said in its first Beige Book report of 2009, which it issues eight times a year.

“Manufacturing activity decreased in most districts . . . and overall economic activity continued to weaken” across most regions, the report said.

In the Kansas City district, one trucking firm said it was driving more empty miles, while another said that for the first time in two years, it had enough qualified drivers.

In the Dallas region, contacts noted that the recent plunge in commodity prices provided only slight relief in production costs, and that some pricing on rail and truck transportation have not fallen, due to long-term contracts.

The Beige Book report, prepared by the St. Louis Fed, was based on information collected from Nov. 24 through Jan. 5.