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Economy in Brief

U.S. Business Inventories Remain Unchanged While Sales Ease
by Tom Moeller  November 15, 2019

Total business inventories held steady during September (3.7% y/y) following a 0.1% August dip, revised from 0.0%. Total business sales weakened 0.2% (+0.5% y/y) after a 0.1% uptick, revised from 0.2%. The inventory-to-sales (I/S) ratio held steady at 1.40 for the fifth straight month.

Retail inventories rose 0.2% (3.8% y/y) in September and reversed the August decline. Auto inventories rose 0.2% (5.3% y/y) while nonauto inventories gained 0.2% (3.0% y/y). Inventories of furniture & home furnishings declined 0.5% (-2.2% y/y), down for the sixth month in the last seven. Clothing inventories eased slightly (+1.1% y/y) after a 0.2% decline. General merchandise store inventories rebounded 0.7% (0.6% y/y) after a 0.3% drop while department store inventories gained 0.4% (-7.2% y/y), rising for only the second month this year. Wholesale inventories declined 0.4% (+4.8% y/y) in September after rising slightly for two months. Factory sector inventories increased 0.3% (2.6% y/y) after little change over three months.

Retail sales declined 0.5% (+3.8% y/y) in September after a 0.6% rise. Sales excluding autos declined 0.2% (3.4% y/y). Wholesale sector sales were unchanged (-0.6% y/y) after easing 0.1%, while shipments from the factory sector fell 0.2% (-1.2% y/y).

The inventory-to-sales ratio in the retail sector rose slightly to 1.45, but has been falling since early this year. The non-auto retail I/S ratio also rose slightly, but nearly matched its all-time low. The wholesale I/S ratio was unchanged at 1.36 in September while the manufacturing I/S ratio held at 1.39.

The manufacturing and trade data are in Haver's USECON database.

Manufacturing & Trade Sep Aug July Sep Y/Y 2018 2017 2016
Business Inventories (% chg) 0.0 -0.1 0.3 3.7 4.9 3.4 1.7
  Retail 0.2 -0.2 0.7 3.8 4.2 2.4 4.0
    Retail excl. Motor Vehicles 0.2 -0.2 0.3 3.0 1.7 2.0 2.0
  Merchant Wholesalers -0.4 0.1 0.2 4.8 7.1 3.3 1.9
  Manufacturing 0.3 -0.1 0.1 2.6 3.5 4.5 -0.7
Business Sales (% chg)
Total -0.2 0.1 0.2 0.5 6.1 5.4 -0.8
  Retail -0.5 0.6 0.8 3.8 4.6 4.5 2.4
    Retail excl. Motor Vehicles -0.2 0.2 0.9 3.4 5.3 4.8 1.9
  Merchant Wholesalers 0.0 -0.1 0.2 -0.6 6.5 6.7 -1.3
  Manufacturing -0.2 -0.3 -0.3 -1.2 6.9 5.0 -3.2
I/S Ratio
Total 1.40 1.40 1.40 1.36 1.36 1.38 1.42
  Retail 1.45 1.44 1.45 1.45 1.45 1.47 1.49
    Retail excl. Motor Vehicles 1.19 1.18 1.18 1.19 1.20 1.24 1.28
  Merchant Wholesalers 1.36 1.36 1.36 1.29 1.29 1.30 1.35
  Manufacturing 1.39 1.39 1.38 1.34 1.35 1.37 1.41
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