The overall economic activity in the US improved in recent months while the labour market continued to strengthen, according to the Federal Reserve.
The latest readings comes a week after official data showed that American economy expanded 2.8% in the last three months of 2010, lower than the initial projection of 3.2%.
"... Overall economic activity continued to expand at a modest to moderate pace in January and early February," the Beige Book released on Wednesday said.
Beige Book provides an informal snapshot of economic activities in 12 federal districts and the views help in charting out the overall monetary policies.
"Labour market conditions continued to strengthen modestly, with all districts reporting some degree of improvement," the report noted.
Despite improving economic conditions, unemployment rate remains at high levels.
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"Manufacturing and retail contacts across districts reported rising input costs. Manufacturers in many districts conveyed that they were passing through higher input costs to customers or planned to do so in near future," it said.
However, overall sales as well as construction in the real estate sector remained at low levels across all districts.