Finally, local banks report a pickup in loan demand, and a continued modest decline in consumer delinquency rates. Consumer Spending Retailers report that sales were generally on plan in January but above plan in February. Same-store sales for the two months, compared to a year earlier, varied widely from no gain to a 10 percent increase. In general, those retailers with weak sales attributed the softness to unusually mild winter weather. Those with strong February sales noted that virtually all categories performed well, especially furnishings, appliances and women's apparel.
Most retailers report that inventories are in good shape.
Overall, it appears that discounters continue to fare slightly better than traditional department stores. Retail selling prices and merchandise costs were said to be mostly flat, and no increases in wage pressures were reported. The region's housing market continued to strengthen in early 1998. New Jersey homebuilders report that new home sales were brisk in February especially at the high end of the market, where nearly all of the buyers are in the securities industry, as opposed to the usual broad mix of high-level executives. Aside from large Wall Street bonuses, strong market conditions in early 1998 are attributed to mild winter weather, low but rising mortgage rates, and increased consumer confidence.