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Economy in Brief
U.S. Consumer Credit Growth Surges in June
Consumer credit outstanding jumped $40.1 billion (7.7% y/y) in June...
Japan's LEI Waffles and Slows
Japan's leading economic index in June slipped to 100.6...
U.S. Foreign Trade Deficit Narrows in June
The U.S. trade deficit in goods and services (BOP basis) fell to $79.61 billion in June...
U.S. Unemployment Claims Remain on an Uptrend
Initial claims for unemployment insurance filed in the week ended July 30 rose 6,000 to 260,000...
RICS Survey Shows Weakening U.K. Housing Market
With the Bank of England hiking its key rate by 50 basis points and planning to squeeze its balance sheet...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
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No Recession Call Can Be Made Before BEA Explains The Record Gap Between Income & Output
by Tom Moeller December 13, 2005
Total business inventories rose 0.3% in October following an unrevised 0.5% gain the prior month. Despite these increases, the ratio of inventories-to-sales held at the record low of 1.25 as business sales increased 0.8% (7.6% y/y).
Business' hesitancy to build inventory is evident from several aspects of the latest release. While the annual growth in business sales has slowed to 7.6% from 9.7% during all of 2004, the growth in inventories has nearly halved to 4.1% from 7.7% last year. And the following detail underscore that hesitancy.
Retail inventories rose just 0.1% and even that small addition was due to a 0.7% rise in motor vehicle inventories which followed large additions during the prior two months. Excluding autos, inventories fell 0.1% and the September increase was revised sharply lower. Clothing inventories managed a 0.3% (5.7% y/y) but general merchandise fell 0.1% (+6.2% y/y). Inventories of furniture fell by 0.3% (+5.8% y/y) for the fourth consecutive down month.
Wholesale inventories rose just 0.2%. During the last ten years there has been a 66% correlation between the y/y change in wholesale inventories and the change in imports of nonpetroleum goods.
Factory sector inventories jumped 0.6% led by a 3.7% surge at petroleum refineries.
Business Inventories | Oct | Sept | Y/Y | 2004 | 2003 | 2002 |
---|---|---|---|---|---|---|
Total | 0.3% | 0.5% | 4.1% | 7.7% | 1.4% | 1.6% |
Retail | 0.1% | 0.8% | 1.7% | 5.7% | 3.9% | 5.9% |
Retail excl. Autos | -0.1% | 0.1% | 5.1% | 5.9% | 2.0% | 2.3% |
Wholesale | 0.2% | 0.6% | 6.6% | 10.8% | 2.0% | 1.2% |
Manufacturing | 0.6% | 0.1% | 4.7% | 7.7% | -1.1% | -5.4% |