The most recent Burgundy Books, released by the Federal Reserve Bank of St. Louis on June 24, show mixed displays of optimism about the local economies of the four zones—St. Louis; Memphis, Tenn.; Little Rock, Ark.; and Louisville, Ky.—comprising the Eighth Federal Reserve District.
The majority of business contacts in the St. Louis and Little Rock zones expect economic conditions to be better or somewhat better in 2014 compared to last year, and Louisville zone contacts showed modestly higher optimism about the economy in 2014 than existed three months earlier. However, nearly one in five business contacts in the Memphis zone expect conditions to be worse this year than last year.
The St. Louis zone’s unemployment rate averaged 7.2 percent in the first quarter, a sizable increase from the 6.7 percent seen in the previous quarter. Still, the zone continues to have some of the lowest unemployment rates in the Eighth District.
The Memphis zone’s unemployment rate declined to 8.8 percent in the first quarter. In Memphis, employment in the trade, transportation and utilities industry rose at a modest pace, and wage growth was especially strong, though it was weaker in other areas around the zone.
The Little Rock zone’s unemployment rate averaged 6.8 percent in the first quarter, down from 7.2 percent in the previous quarter. Two of the four metropolitan statistical areas (MSAs) in the zone—Fayetteville, Ark., and Little Rock—had unemployment rates below the national average of 6.7 percent.
The Louisville zone’s unemployment rate averaged 7.2 percent in the first quarter. This was its lowest rate since 2008.
Residential home prices increased in three of the four MSAs in the St. Louis zone, paced by sizable increases in St. Louis and Columbia, Mo.
The Memphis residential housing market was soft in the first quarter of 2014. Still, house prices were up strongly in Memphis, and building permits rose sharply in Jonesboro, Ark.
Compared with a year earlier, house prices and single-family building permits declined in the first quarter in the Little Rock zone, although Fayetteville and Texarkana, Ark.-Texas, were notable exceptions.
Residential construction activity and single-family house prices declined in most areas of the Louisville zone in the first quarter. However, business contacts in Louisville continued to report robust growth in the multifamily sector.
Mortgage and credit card balances rose modestly in the first quarter in the St. Louis zone, but still remained below last year’s levels. Mortgage loan delinquencies were about half of the national average.
In the Memphis zone, households continued to reduce their credit card and mortgage balances in the first quarter. Relative to the nation, mortgage delinquency rates were modestly lower, while credit card and auto loan delinquency rates were modestly higher.
Households in the Little Rock zone continue to pare their mortgage debt and credit card balances. However, auto loan debt increased at a healthy pace in the first quarter and by a larger percentage than seen nationally.
In the fourth quarter of 2013, nominal per capita income for Indiana and Kentucky rose modestly faster than the national pace. The pace of consumer auto debt continued to increase but has slowed sharply over the past few quarters.
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Views expressed are not necessarily those of the Federal Reserve Bank of St. Louis or of the Federal Reserve System.