FED FINDS ECONOMY MOSTLY HEALING

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, January 22, 1993                   TAG: 9301220248
SECTION: BUSINESS                    PAGE: A-5   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium
FED FINDS ECONOMY MOSTLY HEALING
Lifted by strong Christmas sales, the economy is improving everywhere in the United States but California, the Federal Reserve said Thursday in an assessment of economic conditions facing the new administration.
"Reports . . . indicate continued improvement in economic conditions across much of the nation," the central bank said in its latest "beige book," a summary of regional business activity.
The report, the most upbeat from the Fed since late last spring, singled out retail sales as a bright spot. It said manufacturing also was improving with little upward pressure on prices, but cautioned that the job market still hasn't responded fully to the rising economy.
"Retail sales during the holiday season were significantly better than a year earlier . . . generally fulfilling or exceeding retailers' expectations," it said.
The report, named for the color of its cover, is compiled eight times a year. It is used by the Federal Reserve panel that determines monetary policy. The panel next meets on Feb. 2-3 and Thursday's report presages no change in interest rates, economists said.
Economist Robert G. Dederick of Northern Trust Co. in Chicago said he saw little likelihood the Fed would move interest rates up or down in the near future.
"The beige book seems consistent with the notion that there is a quickening in the growth pace, but it does leave us with that same old cloud. When it comes to hiring, the caution stood out," he said.
The Fed also said loan demand at banks and S&Ls was rising slightly and fall crop yields were at record levels.
The only other negative noted in the report's summary was continued weakness in the commercial real estate market. It said residential markets were improving.
The latest beige book was based on interviews of business people conducted before Jan. 12.

by Bhavesh Jinadra by CNB