Severe weather held back economic growth in much of the nation from January through early February, a Federal Reserve survey shows. Even so, conditions strengthened in most U.S. regions, thanks to slight gains in areas such as employment and commercial real estate.
Eight of the Fed’s 12 regions reported improved activity, according to the Beige Book survey released Wednesday. The improvement was depicted as modest to moderate.
New York and Philadelphia, two regions hard hit by winter storms and freezing cold, reported a dip in activity attributed to the weather. Retail sales, including auto purchases, were depressed. So was manufacturing. Factories reported power outages and delayed deliveries of supplies.
Lilly diabetes drug meets roadblock
Drugmakers Eli Lilly and Boehringer-Ingelheim said Tuesday the Food and Drug Administration failed to approve their diabetes treatment empagliflozin because of concerns about a complex where the drug will be made.
The companies said the FDA isn’t asking for new studies of empagliflozin. They said they intend to reply to the agency as soon as possible.
Empagliflozin is a tablet that is intended to be taken once a day as a treatment for Type 2 diabetes. It is designed to reduce a patient’s blood sugar levels by blocking glucose re-absorption in the kidneys and removing excess glucose through urine. Unlike other diabetes treatments, it does not depend on a patient’s insulin levels to be effective.
The drug will be made at a facility in Ingelheim, Germany. In May, the FDA sent Boehringer-Ingelheim a warning letter that cited significant violations of manufacturing standards at the facility. The agency said the company failed to investigate and fix foreign particles that were found in the active drug ingredient that was being manufactured, among other concerns.
Slower growth seen in service sector
U.S. service companies expanded more slowly in February as hiring levels declined in a cautionary sign for the economy coming out of winter.
The Institute for Supply Management said Wednesday that its service-sector index fell to 51.6 from 54 in January. Any reading above 50 indicates expansion.
But the harsh winter posed challenges. The real estate, retail, hotel, food services and construction industries all contracted last month.
Local building down in February
The Home Builders Association of Fort Wayne said there were 34 Allen County residential construction requests in February, compared with 50 permits the same month a year ago.
The average construction price was $270,733 in February, compared with $203,389 in February 2013, which saw a spike in construction in Perry Township, led by the Tuscany subdivision, a 156 single-family residential project.
Storms put dent in pace of hiring
A private survey shows that U.S. companies added slightly more jobs in February than in the previous month, but harsh winter weather still weighed on hiring.
Payroll processor ADP said Wednesday that businesses added 139,000 jobs last month, up from only 127,000 in January. But January’s figure was revised sharply lower from an original estimate of 175,000.