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The Honolulu Advertiser
Posted on: Thursday, October 16, 2008

Fed notes weakening of economy, tourism in Isles

Advertiser Staff

Hawaii news photo - The Honolulu Advertiser

Ala Moana Center is all about retailing. The Fed's Beige Book report, released yesterday, notes sluggish retail sales and weakening economic activity in its 12th District, which includes Hawai'i.

ADVERTISER LIBRARY PHOTO | January 2008

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The latest economic update from the Federal Reserve Board's 12th District says economic activity has weakened in the region, including a significant drop in tourism in Hawai'i.

The so-called Beige Book is issued roughly every six weeks and is a roundup of anecdotal economic reports in the nine western states and two Pacific territories that make up the 12th District. The report said activity was off during the September-to-early October period, with sluggish retail sales, lower demand for services and anemic housing markets.

It also noted that financial institutions in the region reported a decline in loan demand and credit quality, and a drop in credit availability.

"Credit availability declined significantly as banks and other financial institutions faced rising difficulties securing short-term funding," the report said. "Contacts also pointed to higher delinquency rates in all loan categories."

It also noted a drop in tourism.

"Contacts noted modest declines in tourist activity in some major tourist destinations in the district, such as Southern California and Las Vegas; the drop was more significant in Hawai'i and was accompanied by layoffs there," the report said.