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Economy in Brief
UK Consumer Sentiment Hits Lowest Reading since 1996
(when the GFK survey began; also lowest reading 'ever')
Of these 13 readings eight of them declined on the month in May three of them improved and two of them were unchanged...
U.S. Existing Home Sales Continue to Fall in April as Houses Become Less Affordable
The combination of soaring home prices across the nation and rising interest rates is making homes less affordable...
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...
CBI Gauge in the UK Continues to Be Upbeat
The global economy has a lot of challenges...
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 and 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 Gerald D. Cohen April 18, 2019
Total business inventories increased 0.3% (4.9% year-on-year) during February, after a slightly upwardly-revised 0.9% gain in January. Total business sales edged up 0.1% (2.4% y/y) following a 0.3% rise. The inventory-to-sales (I/S) ratio stood at 1.39 for the third consecutive month. Business inventory swings can have a meaningful impact on GDP. In the second and third quarters of 2018 changes in inventories subtracted 1.2 percentage points and then added 2.3 ppt respectively. In Q4, inventories provided just a 0.1 percentage point boost.
Retail inventories increased 0.3% (4.3% y/y) in February after a 0.8% gain. Auto inventories, which comprise roughly 35% of retail inventories, grew 0.3% (8.6% y/y) Non-auto retail inventories rose 0.4% (1.9% y/y). General merchandise inventories, the second largest sector, declined 0.2% both for February and from a year ago. The troubled department store sector – a subset of general merchandise – saw inventories down 0.3% (-6.2% y/y); inventories plummeted a record 5.3% in November 2018 (data goes back to 1992) and have not recovered. Factory sector inventories gained 0.3% (3.6% y/y). As reported yesterday, wholesale inventories were up 0.2% (6.9% y/y).
Retail sales declined a downwardly-revised 0.3% in February (+1.9% y/y) with non-auto sales also down 0.3% (+2.0% y/y). Note: the advanced retail sales data for March was released today showing a 1.7% jump (3.5% y/y). Wholesale sector sales increased 0.3% (2.1% y/y), while shipments from the factory sector rose 0.4% (3.3% y/y) after four consecutive monthly declines.
The inventory-to-sales ratio in the retail sector edged up to 1.48 in February. The non-auto I/S ratio ticked up to 1.21 slightly above the historic low of 1.17 reached in November 2018 (data goes back to 1967). The wholesale and factory sector I/S ratios were unchanged at 1.35 and 1.36 respectively.
The manufacturing and trade data are in Haver's USECON database.
Manufacturing & Trade | Feb | Jan | Dec | Feb Y/Y | 2018 | 2017 | 2016 |
---|---|---|---|---|---|---|---|
Business Inventories (% chg) | 0.3 | 0.9 | 0.8 | 4.9 | 4.9 | 3.4 | 1.7 |
Retail | 0.3 | 0.8 | 1.1 | 4.3 | 4.2 | 2.4 | 4.1 |
Retail excl. Motor Vehicles | 0.4 | 0.7 | 1.3 | 1.9 | 1.2 | 2.2 | 1.9 |
Merchant Wholesalers | 0.2 | 1.2 | 1.1 | 6.9 | 7.1 | 3.3 | 1.9 |
Manufacturing | 0.3 | 0.5 | 0.1 | 3.6 | 3.5 | 4.5 | -0.7 |
Business Sales (% chg) | |||||||
Total | 0.1 | 0.3 | -0.9 | 2.4 | 6.1 | 5.6 | -0.8 |
Retail | -0.3 | 0.8 | -1.8 | 1.9 | 4.7 | 5.0 | 2.5 |
Retail excl. Motor Vehicles | -0.3 | 1.6 | -2.5 | 2.0 | 5.4 | 5.0 | 2.0 |
Merchant Wholesalers | 0.3 | 0.5 | -0.7 | 2.1 | 6.6 | 6.7 | -1.3 |
Manufacturing | 0.4 | -0.3 | -0.2 | 3.3 | 6.8 | 5.0 | -3.2 |
I/S Ratio | |||||||
Total | 1.39 | 1.39 | 1.39 | 1.36 | 1.36 | 1.38 | 1.42 |
Retail | 1.48 | 1.47 | 1.47 | 1.45 | 1.44 | 1.47 | 1.49 |
Retail excl. Motor Vehicles | 1.21 | 1.20 | 1.21 | 1.21 | 1.20 | 1.24 | 1.28 |
Merchant Wholesalers | 1.35 | 1.35 | 1.34 | 1.29 | 1.29 | 1.30 | 1.35 |
Manufacturing | 1.36 | 1.36 | 1.35 | 1.36 | 1.35 | 1.37 | 1.41 |