The Federal Reserve Bank of St. Louis Sept. 16 released its most recent summation of economic development in its district, which the report characterized as remaining "quite healthy."
The Eighth District of the Federal Reserve comprises eastern Missouri, Arkansas, western Kentucky, western Tennessee, southern Illinois, southern Indiana and northern Mississippi.
"Although the pace of growth does not appear to have slowed much, particularly in view of recent financial market unrest, there is some expectation of moderating labor market demand over the last three months of the year," the report began.
The report said retail sales were up 4 percent on average over 1997, which met or exceeded the expectations of retailers in the district. Those contacted for the report said electronics, apparel and lawn and garden sales were high, and fine jewelry was off.
"Contacts have not yet observed a falloff in sales because of the swings in the stock market and are optimistic about sales prospects for the rest of the year," the report said.
Though General Motors dealers within the district had sales decrease by an average of 25 percent in July and August compared to last year, other dealers said sales were flat to up moderately. GM sales were down because of shortages of cars due to worker strikes that have now been resolved.
"Despite the wild ride stock markets have taken over the past few weeks, most contacts report that they have not seen a major change in economic fundamentals, at least not yet," the report said.
The labor market, particularly for skilled labor, remained tight within the St. Louis-based Fed's district. Building material and household appliance sales were reported as "relatively robust."
Related to that, sales of new and existing homes were reported as continuing to boom throughout the district, keeping turnaround times short and prices up.
Total loans on the books at a sample of large district banks rose 0.5 percent between mid-June and mid-August. In 1997, loans increased 1.7 percent during the same period.
Outstanding commercial and industrial loans declined 0.9 percent and real estate loans declined 0.2 percent. Consumer loans rose 0.9 percent.
The Federal Reserve Bank of St. Louis has branches in Louisville, Little Rock and Memphis, along with its headquarters in St. Louis. The report cited above is issued eight times a year.
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