Credit promotions have become more commonplace, however, due to increased competitive pressures. Retailers maintain that the labor market is tight, and many continue to experience difficulty in finding qualified workers. Inventories were in line with sales expectations. Even General Motors dealers indicated that vehicle stocks had returned to normal following the strike-related shortages of the summer. Banking and Finance District lending activity remains unchanged at a high level in most credit categories.
Banks report a slight increase in consumer loans due to year-end car purchases.
Banks also indicate that loan delinquencies are holding steady at a low level. Some District banks report adverse effects from the Asian economic crisis as industrial customers experienced falling prices and a slowdown in business growth. Although some banks report tightening their credit standards, most indicate little change. Credit availability remains high. The spread between borrowing and lending rates has narrowed further and competition for borrowers remains intense.