The Federal Reserve paints a mixed picture of Connecticut”™s and New York”™s economies in its latest report.
The Fed”™s “Beige Book,” which reviews current economic conditions across the 12 Federal Reserve Districts, said that while economic activity increased among most Districts, gains were generally modest and activity remained well below levels prior to the Covid-19 pandemic.
“Continued uncertainty and volatility related to the pandemic, and its negative effect on consumer and business activity, was a theme echoed across the country,” the Federal Reserve wrote.
Connecticut, part of the Fed’s First District, based in Boston, recorded strong automobile sales through June, July and the start of August, it said, with the exception of the week that much of the state suffered power outages caused by Tropical Storm Isaias.
The Beige Book cited an anonymous furniture retailer that reported its average weekly sales were up 30% compared to last summer, with weekly online sales up more than 300% compared with the same time period a year ago and in-store sales roughly a third of pre-pandemic levels.
Although information about Connecticut”™s residential real estate market was unavailable, data from the district”™s other New England states ”“ Massachusetts, New Hampshire, Maine, and Rhode Island ”“ were relatively strong.
Economic growth in the Second District, which includes New York, stalled in the latest reporting period, “even as the spread of the virus has remained subdued and more businesses have gradually reopened,” the report said.
While an unspecified “major upstate New York employment agency and a payroll processing firm both reported that hiring activity has picked up somewhat since midyear,” it continued, “a major New York City agency specializing in office jobs indicated that hiring has remained sluggish, as fewer people are leaving jobs and companies have been reluctant to on-board new workers remotely.”
According to dealers in upstate New York, new vehicle sales softened after a fairly strong rebound in May and June.
Tourism has remained depressed, with Manhattan hotels still running at well under half capacity, though weekend occupancies have increased.
New York City’s sales and rental markets also weakened further, with vacancy rates reaching multi-year highs in Manhattan and rents down roughly 10% from a year ago with increased landlord concessions. Otherwise, the single-family rental market has been relatively strong across much of the district, the report said.
Sales of condos and co-ops in New York City have rebounded modestly from depressed spring levels, while prices have fallen as the number of listings has swelled.
In addition, office availability rates continued to rise, while rents were flat or declining. Retail rents have also been flat to lower, as vacancy rates have risen to multi-year highs, according to the Fed.
