Economic recovery ‘picking up some speed’

? The worst blackout in U.S. history seems to have had only a limited impact on the economy, which flashed more growth signals in July and August.

The Federal Reserve’s latest snapshot of economic conditions around the country, released Wednesday, said that although five of the Fed’s 12 districts — New York, Cleveland, Atlanta, Chicago and Dallas — noted that business was affected by the mid-August power outage, “the effects were generally small.”

“Even where firms were closed for several days,” the Fed survey said, the affected businesses “are not anticipating difficulties in making up for lost production or shipments.”

On the economy as a whole, the Fed’s survey said that progress was being made.

Reports from the Fed’s districts “indicate that the economy continued to improve in July and August,” the report said. “In some districts, improvement occurred in selected sectors and in others it was broad-based.”

The Kansas City district reported positive gains in the economy. The retail, car sales, residential real estate and manufacturing sectors reported improvements. Commercial real estate and agriculture were still seen as struggling.

The regular survey of business conditions, based on information collected before Aug. 25, will help Fed policy-makers when they meet on Sept. 16 to set interest rates.

Amid growing signs of an economic rebound, economists believe the Federal Reserve will probably hold a key short-term interest rate at a 45-year low of 1 percent at that meeting.

“All the different bits and pieces seem to add up to a pretty positive story for this quarter,” said Bill Cheney, chief economist at John Hancock. “The report supports the view that the recovery is picking up some speed.”

The Fed survey hinted at pockets of relief.

“Manufacturing labor demand appears to be firming,” the survey said. “A majority of districts indicate scattered reports or projections of longer work hours and selective hiring, and several report that layoffs are becoming less frequent.”