The Federal Reserve Bank of St. Louis’ Burgundy Books, released Tuesday, show mixed optimism among business contacts in the four zones—St. Louis; Little Rock, Ark.; Louisville, Ky.; and Memphis, Tenn.—comprising the Eighth Federal Reserve District.
Only in the Louisville Zone did a majority of business contacts expect economic conditions to improve over the second half of 2014. A little less than half of the contacts surveyed in the St. Louis, Little Rock and Memphis zones expected conditions to improve.
The St. Louis Zone’s unemployment rate averaged 6.6 percent in the second quarter of 2014, down sharply from the previous quarter’s average of 7.2 percent.
The unemployment rate in the Little Rock Zone averaged 6.2 percent in the second quarter, falling to its lowest level since 2008 and equaling the nation’s unemployment rate.
The Louisville Zone’s unemployment rate averaged 6.8 percent in the second quarter, down from 7.2 percent in the first quarter.
The Memphis Zone’s unemployment rate declined to 8.4 percent in the second quarter from 8.8 percent the previous quarter.
The pace of residential construction activity slowed during the second quarter in most areas of the St. Louis Zone, though multifamily construction activity remained vibrant.
House prices and single-family building permits declined in the second quarter in a majority of the Little Rock Zone’s metropolitan statistical areas (MSAs).
Total home sales and single-family building permits in the Louisville MSA declined in the second quarter, though residential permit activity picked up in most other MSAs.
House prices were up strongly in the Memphis MSA for the second consecutive quarter, but single-family building permits and total home sales declined.
Household balance sheets improved across the St. Louis Zone in the second quarter, as mortgage and credit card delinquencies fell significantly and balances continued to contract.
Since mid-2009, growth of auto and student loan debt balances has roughly offset the decline in mortgage and credit card balances in the Little Rock Zone.
Household delinquency rates for mortgages and credit cards declined significantly in the Louisville Zone in the second quarter.
Households in the Memphis Zone reduced their credit card and mortgage balances in the second quarter at a faster rate than the national rate.