WASHINGTON (AP) The Federal Reserve said economic growth slowed in a few key regions of the United States from September through early October, as businesses grew worried about a budget impasse that led to a partial government shutdown.
Overall, the economy continued to expand at a "modest to moderate" pace, according to the Fed survey released Wednesday. Eight of the Fed's 12 banking districts reported the same growth rate as they had reported in August through early September. But four districts Philadelphia, Richmond, Chicago and Kansas City said growth had slowed.
Businesses around the country remained optimistic about the future and consumer spending continued to increase, helped by strong auto sales. But many businesses noted greater uncertainty because of the federal shutdown, which began on Oct. 1, and a looming deadline to raise federal borrowing limit.
Boston, in particular, reported that the tourism industry was worried about the impact of a prolonged shutdown. And several Districts reported that businesses were cautious about hiring.
Senate leaders announced Wednesday that they had an agreement to avert a threatened Treasury default and reopen the government after the 16-day shutdown. The House was likely to approve the measure, too, leading many to anticipate passage in both chambers before the end of the day.