The US economy has weakened since mid-October as the worst financial crisis in decades, which is ongoing as of December, damps consumer spending and business investment, the Federal Reserve said yesterday in its latest survey on business conditions around the nation.

"Overall economic activity weakened across all Federal Reserve districts" since the last report, which was issued on Oct. 15, the Fed said in the survey, the so-called Beige Book.

Districts generally reported decreases in retail sales, and vehicle sales were down significantly in most districts, according to the survey, which is based on economic information supplied by the Fed's 12 regional banks and collected before Nov. 24.

The survey showed that tourism spending was subdued in a number of districts, it said, adding that reports on the service sector were generally negative.

Manufacturing activity declined in most districts and new orders were soft.

Nearly all districts reported weak housing markets characterized by reduced selling prices and low, but stable, sales activity. Meanwhile, commercial real estate markets declined in most districts.

In addition, lending contracted, with many districts reporting reductions in residential, commercial and industrial lending and tightening lending standards.

Agricultural conditions were mixed with a relatively good harvest but concerns about profitability. Mining and energy production and exploration started to soften due to lower output prices.

At the same time, the Fed's survey suggested that businesses have little appetite to hire.

"District reports generally described labor market conditions as weakening," it said.

But wage pressures were largely subdued. District reports characterized price pressures as easing in light of some decreases in retail prices and declines in input prices, particularly energy, fuel, and many raw materials and food products.

The survey summarizes comments received from business and other contacts outside the Fed and is not a commentary on the views of Fed officials.

However, information from the survey will figure into discussions at the Fed's next policy-making meeting to be held later this month.