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Economy in Brief
U.S. Index of Leading Indicators Fell in April
Five of the index's components fell in April, one was unchanged and four increased...
U.S. Unemployment Claims Rose in the Latest Week
The state insured rates of unemployment in regular programs vary widely...
U.S. Housing Starts Dip in April but Remain Elevated
The pattern of housing construction activity seems to be shifting toward multifamily...
U.S. Mortgage Applications Continued to Slide Amid Higher Rates
The biggest declines have been in refinancing activity, while applications for purchase are just starting to crack...
UK Inflation Jumps
Inflation is at the highest rate since the series began in January of 1989...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Profits and Margins Plunge In Q1: Expect More Margin Contraction As Fed Squeezes Inflation
The Many Links of Inflation Cycle: Hard Landing Is Needed to Crack Them
Peak Inflation & Fed Policy: A Relationship Which Should Worry The Fed And Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
by Tom Moeller September 14, 2018
Total business inventories increased 0.6% (4.3% y/y) during July following a 0.1% June rise. It was the strongest increase since February. Total business sales increased 0.2% (8.1% y/y), following a 0.3% gain. The inventory-to-sales ratio rose to 1.34 from 1.33. It peaked early in 2016 at 1.43.
Retail inventories increased 0.5% (2.3% y/y) in July, following a 0.1% dip. Auto inventories jumped 1.2% (2.8% y/y) after a 0.1% easing. Non-auto retail inventories increased 0.1% (2.0% y/y) following a 0.1% slip. General merchandise inventories rose 0.3% (0.2% y/y) after a 0.4% fall. In the department store sector, inventories declined 0.6% (-3.0% y/y) following a 0.7% fall. Building materials inventories rose 0.7% (7.4% y/y) after a 1.4% jump, but clothing store inventories fell 0.2% (-0.8% y/y), down for the fifth straight month. Inventories of furniture, electronics and appliances recovered 1.2% (-0.9% y/y) after declining for five of six months this year. As reported earlier, wholesale inventories rose 0.6% (5.0% y/y) following a 0.1% rise. Factory sector inventories surged 0.8% (5.6% y/y) following two months of 0.2% gain.
Retail sales rose 0.5% (6.2% y/y) in July after a 0.1% improvement. Non-auto sales strengthened 0.7% (7.2% y/y) after a 0.1% gain. Wholesale sector sales eased (+9.8% y/y) for a second straight month. Shipments from the factory sector held steady (8.1% y/y) following two months of strong growth.
As the overall business inventory-to-sales (I/S) ratio rose to 1.34 in July, the retail sector ratio held steady at 1.43, down sharply from the levels averaged during the prior two years. The non-auto I/S ratio also was steady at 1.19, its lowest level since early-2012. The ratio peaked at 1.29 early in 2016. The wholesale sector I/S ratio rose slightly to 1.26. The manufacturing sector I/S ratio inched higher to 1.35, but remained near the three-year low.
The manufacturing and trade data are in Haver's USECON database.
Manufacturing & Trade | Jul | Jun | May | Jul Y/Y | 2017 | 2016 | 2015 |
---|---|---|---|---|---|---|---|
Business Inventories (% chg) | 0.6 | 0.1 | 0.3 | 4.3 | 3.5 | 1.8 | 1.7 |
Retail | 0.5 | -0.1 | 0.4 | 2.3 | 2.4 | 4.1 | 4.9 |
Retail excl. Motor Vehicles | 0.1 | -0.1 | 0.1 | 2.0 | 2.3 | 1.9 | 3.9 |
Merchant Wholesalers | 0.6 | 0.1 | 0.3 | 5.0 | 3.6 | 2.2 | 1.2 |
Manufacturing | 0.8 | 0.2 | 0.2 | 5.6 | 4.5 | -0.7 | -0.8 |
Business Sales (% chg) | |||||||
Total | 0.2 | 0.3 | 1.3 | 8.1 | 5.8 | -0.8 | -3.4 |
Retail | 0.5 | 0.1 | 1.0 | 6.2 | 4.9 | 2.5 | 1.9 |
Retail excl. Motor Vehicles | 0.7 | 0.1 | 1.2 | 7.2 | 4.9 | 2.0 | 0.4 |
Merchant Wholesalers | -0.0 | -0.2 | 2.1 | 9.8 | 7.4 | -1.3 | -4.9 |
Manufacturing | 0.0 | 1.0 | 0.6 | 8.1 | 5.0 | -3.2 | -6.2 |
I/S Ratio | |||||||
Total | 1.34 | 1.33 | 1.34 | 1.39 | 1.38 | 1.42 | 1.39 |
Retail | 1.43 | 1.43 | 1.43 | 1.48 | 1.47 | 1.49 | 1.46 |
Retail excl. Motor Vehicles | 1.19 | 1.19 | 1.20 | 1.25 | 1.24 | 1.28 | 1.27 |
Merchant Wholesalers | 1.26 | 1.25 | 1.25 | 1.32 | 1.29 | 1.35 | 1.33 |
Manufacturing | 1.35 | 1.34 | 1.35 | 1.38 | 1.37 | 1.41 | 1.39 |