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Economic activity up through mid-November

U.S. economic activity increased across the country through mid-November, but housing markets have cooled and higher energy costs raised worries about inflation and consumer spending, the Federal Reserve said on Wednesday.
/ Source: Reuters

U.S. economic activity increased across the country through mid-November, but housing markets have cooled and higher energy costs raised worries about inflation and consumer spending, the Federal Reserve said on Wednesday.

"Consumer prices remained stable or experienced generally modest increases, but most districts reported increasing input prices, particularly of energy-related products, construction and raw materials, and transportation," the Fed said in its "beige book" summary of economic conditions.

Some Fed districts saw mixed reports on the ability of firms to pass on these higher input prices to consumers.

Many Fed districts reported moderating housing sectors, with Philadelphia, Richmond and Cleveland experiencing slowing home sales. Chicago and Atlanta reported flat home sales, and the Kansas City region experienced excess inventories.

"Generally, residential real estate market activity remained high, but many districts reported a slowing or cooling of activity," the Fed said.

At the same time, many districts saw a pickup in commercial real estate activity.

Fed districts said there were still disruptions to energy production, despite recovery after damage from hurricanes in the late summer.

The Atlanta district reported that production in the Gulf of Mexico had improved since September. However nearly 40 percent of natural gas and half of oil production still remained off-line.

"Most of the petroleum refining capacity in Louisiana and Mississippi was back on-line, but natural gas processing remains a concern as repair of processing facilities is taking longer than expected," the Fed said.

The report was prepared by the St. Louis Fed with data collected before November 21.