The storm was about 95 miles west-northwest of Halifax. Environment Canada measured wind gusts there topping 72 mph (115 kph).
Like North Carolina, New England was also largely spared damage spawned by the storm, but some 19,000 people in Maine and 1,600 in Vermont were without power after high winds and heavy rains pounded the region. There were reports of localized flooding in coastal areas of Massachusetts and the Nova Star Ferry suspended service Friday and Saturday morning because of dangerous seas. No injuries or deaths have been reported.
In North Carolina, some homes and businesses were flooded, trees toppled and initially thousands were without electricity after Arthur raced through the barrier islands Friday. Independence Day fireworks were postponed. About 20 feet of the fragile road connecting Hatteras Island with the rest of the world buckled and required repairs. The road was being reopened Saturday in stages.
Permanent residents of Hatteras Island began returning Saturday. Employees of businesses that need to get ready to accommodate arriving tourists were also being allowed onto the island that had been closed to arrivals since early Thursday. Officials also tested the two-mile-long Bonner Bridge onto the island to ensure it was safe for traffic. The bridge opened at noon to local Hatteras residents and essential workers.
Gov. Pat McCrory expressed relief and started encouraging vacationers to return to the beaches, a message echoed by locals.
"This ain't no damage at all. Everybody will be able to come back probably," Lindell Fergeson of Manteo said after driving around to view the aftermath. "It just held up the Fourth (of July) for a little bit, but everything will be open again."
John Wilson was at work Friday sucking water off the floor of the flooded Manteo building he rents to an art gallery. He felt lucky that the building along the town's waterfront only took a foot of water.
"We'll be back in business in a day or two," Wilson said.
The storm that struck the state's southern coast late Thursday as a Category 2 hurricane quickly moved north Friday to cloud the skies over the Delaware and New Jersey shores. Rain from Hurricane Arthur disrupted some New York-area Independence Day celebrations but cleared in time for the nation's largest fireworks display in the East River between Manhattan and Brooklyn.
Tropical storm warnings were in effect for coastal areas as far north as Cape Cod, Massachusetts, and southeastern Canada. Forecasters predicted the storm would weaken before its center moved over western Nova Scotia in Canada early Saturday.
North Carolina officials worked to restore access to Hatteras Island on the island's only road. The state Transportation Department said it was aiming to restore traffic on North Carolina Highway 12 sometime Saturday, when many vacationers were due to start their weeklong cottage rentals.
Farther south, Ocracoke Island's electricity distribution system was badly damaged by Arthur, leading officials to order residents to quit using air conditioners and water heaters so that generator-supplied power could provide refrigeration and other necessities during a cycle of planned outages. A nightly curfew between 10 p.m. and 6 a.m. was declared until power was fully restored. Vacationers were being coaxed to leave with the offer of free ferry rides out.
Associated Press reporter Jerome Bailey Jr. contributed to this report.