The exception is tourism, where a continuing shortage of hotel rooms in the Boston area is causing room rates to rise. Profit margins are increasing slightly. The remaining firms mostly report that overall sales or orders are steady from a year ago. Some exporters report sharp declines in Asian revenues, while others expect that a slowdown will become noticeable by mid-year. Several respondents express concern that the strong dollar is impeding export growth generally, even beyond Asia.
Manufacturers indicate that most materials costs are flat to down compared to a year ago.
They cite reduced prices for copper and oil in particular, as well as greater bargains on components from Asia. Contacts mention that furniture materials costs are rising, however, along with travel costs. Selling prices are largely stable because of flat to declining supply prices, improved production efficiencies, competitive pressures, and retailer resistance. One maker of machine tools recently implemented a price increase, although another lamented that industry prices are far below normal levels because of intense global competition. Computer prices are falling sharply.