Recent snowstorms doused the recovery spirit, even as the conditions improved slightly, said the Federal Reserve in its Beige book. In its latest assessment of regional economies prepared for the next policy meet on March 16 and which includes data collected on or before February 22, the Fed said 9 out of its 12 districts reported improvement in economic performance, albeit a modest one, with activity hampered held back by snowstorms.

The assessment outlined that manufacturing activity gained momentum in most areas, especially in the automotive and metal industries. On the other hand, consumer spending improved 'slightly' in many districts.

On the labour market front, the Fed reiterated that the situation remained soft and that some areas have either started temporary hiring's or gone slow on layoffs. The ADP employment report released yesterday said private-sector jobs fell by 20,000 in February, the slowest job loss in two years.

Meanwhile, a separate report showed economic activity in the non-manufacturing sector rose for the second consecutive. The ISM index rose to 53 percent in February from 50.5 percent in January, which is the best recording of service sector performance since December 2007.