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Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
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 |