·
Total business inventories rose an
expected 0.4% in October, a bit above a downwardly revised 0.3%
September increase. Over the last three months the 0.4% average increase
was the slowest since March.
· During the last ten years there has been a 57% correlation between the y/y change in business inventories and the change in factory sector industrial production. Using quarterly figures, there has been an 84% correlation between the change in real private nonfarm inventories and production.
·
Business sales fell 0.2% (+3.6% y/y) after
a 2.3% September decline. Manufacturers' sales recovered all of 0.1%
after the 4.2% September drop. Retail sales fell 0.1% (+4.6% y/y) and
wholesale sales fell 0.5% (+5.9% y/y) after a 1.5% September drop. As a
result the inventory to sales ratio rose to 1.31.
· Retail inventories were
unchanged but excluding autos they rose 0.3% after an upwardly revised
0.2% September gain. General merchandise inventories surged 1.2% (2.9%
y/y) and have been accumulating strongly since May. Accumulation of
clothing store inventories also was firm at 0.8% (7.2% y/y). Furniture
inventories rose a moderate 0.3% (5.2% y/y).