Global| Feb 14 2019U.S. Business Inventories Decline Led by Retailers
by:Tom Moeller
|in:Economy in Brief
Summary
Total business inventories slipped 0.1% (+4.6% y/y) during November following an unrevised 0.6% October gain. Total business sales fell 0.3% (+4.2% y/y). The inventory-to-sales ratio held steady at 1.35 and remained below its 1.43 [...]
Total business inventories slipped 0.1% (+4.6% y/y) during November following an unrevised 0.6% October gain. Total business sales fell 0.3% (+4.2% y/y). The inventory-to-sales ratio held steady at 1.35 and remained below its 1.43 peak early in 2016.
Retail inventories declined 0.4% (+3.3% y/y) in November, following a 0.8% rise. Auto inventories improved 0.5% (8.6% y/y) after a 1.1% jump. Non-auto retail inventories declined 1.0% (+0.4% y/y) after a 0.6% rise. General merchandise inventories weakened 1.7% (-0.6% y/y) after a 0.9% rise. In the department store sector, inventories dropped 5.2% (-5.5% y/y) after two months of 0.4% increase. Building materials inventories held steady (6.6% y/y) after a 0.3% rise, while clothing store inventories fell 1.0% (-0.8% y/y) after a 0.9% rise. Inventories of furniture, electronics and appliances declined 4.8% (-1.2% y/y) and reversed three months of increase. As reported earlier, wholesale inventories rose 0.3% (6.9% y/y) following a 0.9% increase. Factory sector inventories eased 0.1% (+4.2% y/y) after a 0.2% improvement.
Retail sales increased 0.2% (4.0% y/y) during November following a 1.0% rise. Non-auto sales were fairly steady (4.7% y/y), following a 0.8% rise. Wholesale sector sales fell 0.6% (+4.0% y/y) for a second straight month. Shipments from the factory sector declined 0.6% (+4.5% y/y), down for the second straight month.
The overall business inventory-to-sales (I/S) ratio held at 1.35 in November. The retail sector ratio eased to 1.43 and remained down sharply from the levels averaged during the prior two years. The non-auto I/S ratio fell to 1.17, its lowest level since early-2012. The ratio peaked at 1.29 early in 2016. The wholesale sector I/S ratio rose to 1.29, the highest level since March. The manufacturing sector I/S ratio increased to 1.35 but remained near the three-year low.
The manufacturing and trade data are in Haver's USECON database.
| Manufacturing & Trade | Nov | Oct | Sep | Nov Y/Y | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|
| Business Inventories (% chg) | -0.1 | 0.6 | 0.5 | 4.6 | 3.5 | 1.8 | 1.7 |
| Retail | -0.4 | 0.8 | 0.1 | 3.3 | 2.4 | 4.1 | 4.9 |
| Retail excl. Motor Vehicles | -1.0 | 0.6 | -0.1 | 0.4 | 2.3 | 1.9 | 3.9 |
| Merchant Wholesalers | 0.3 | 0.9 | 0.7 | 6.9 | 3.6 | 2.2 | 1.2 |
| Manufacturing | -0.1 | 0.2 | 0.6 | 4.2 | 4.5 | -0.7 | -0.8 |
| Business Sales (% chg) | |||||||
| Total | -0.3 | 0.1 | 0.3 | 4.2 | 5.8 | -0.8 | -3.4 |
| Retail | 0.2 | 1.1 | -0.0 | 4.0 | 4.9 | 2.5 | 1.9 |
| Retail excl. Motor Vehicles | -0.0 | 0.8 | -0.3 | 4.7 | 4.7 | 2.5 | .4 |
| Merchant Wholesalers | -0.6 | -0.6 | 0.1 | 4.0 | 7.4 | -1.3 | -4.9 |
| Manufacturing | -0.6 | -0.1 | 0.7 | 4.5 | 5.0 | -3.2 | -6.2 |
| I/S Ratio | |||||||
| Total | 1.35 | 1.35 | 1.34 | 1.35 | 1.38 | 1.42 | 1.39 |
| Retail | 1.43 | 1.44 | 1.44 | 1.44 | 1.47 | 1.49 | 1.46 |
| Retail excl. Motor Vehicles | 1.17 | 1.18 | 1.18 | 1.22 | 1.24 | 1.28 | 1.27 |
| Merchant Wholesalers | 1.29 | 1.28 | 1.27 | 1.26 | 1.30 | 1.35 | 1.33 |
| Manufacturing | 1.35 | 1.34 | 1.34 | 1.35 | 1.37 | 1.41 | 1.39 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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