Global| Sep 12 2014U.S. Business Inventory Gain Is Steady; Sales Increase Firms
by:Tom Moeller
|in:Economy in Brief
Summary
Total business inventories increased 0.4% in July (5.9% y/y) after an unrevised 0.4% rise during June. For all of last quarter, faster accumulation of inventories added 1.4 percentage points to real GDP growth after a 1.2 percentage [...]
Total business inventories increased 0.4% in July (5.9% y/y) after an unrevised 0.4% rise during June. For all of last quarter, faster accumulation of inventories added 1.4 percentage points to real GDP growth after a 1.2 percentage point subtraction in Q1.
Retail inventories jumped 1.0% (6.6% y/y) after a 1.4% rise last quarter. Auto inventories increased 2.3% (13.3% y/y) following a 3.2% Q2 gain. Nonauto inventories increased 0.4% (3.5% y/y), the firmest rise in six months. Building materials inventories rose 0.7% (2.9% y/y) after falling during Q2. General merchandise store inventories gained 0.3% (2.6% y/y) after a 0.2% Q2 decline while food & beverage store inventories also rose 0.3% (2.7% y/y). Furniture & home furnishings inventories gained 0.2% (6.2% y/y) after a 2.4% Q2 jump. Clothing inventories inched 0.1% higher for a second month following a 0.4% gain during Q2.
Factory sector inventories ticked 0.1% higher (3.9% y/y) reflecting a 0.5% increase (5.9% y/y) in durables and a 0.4% decline (+0.8% y/y) in nondurables. The 0.1% uptick (7.9% y/y) in wholesale inventories followed a moderated 1.5% increase last quarter and reflected a 0.3% gain (8.4% y/y) in durables. Nondurables inventories were unchanged (7.0% y/y) following two months of decline.
The latest inventory gains were accompanied by a strengthened 0.8% increase (5.3% y/y) in business sales. Merchant wholesale sales gained 0.7% (7.5% y/y). Retail sales increased a lessened 0.3% (3.9% y/y) and excluding autos sales also gained 0.3% (3.4% y/y). Shipments from the factory sector jumped 1.2% (4.3% y/y), the strongest increase since November.
The overall inventory-to-sales ratio remained at 1.29 for a fifth straight month, down a bit from the 1.31 January high. The I/S ratio in the wholesale sector slipped to 1.16 and in the factory sector it edged down to 1.29. The retail sector inventory-to-sales ratio ticked up to 1.43 while the nonauto retail ratio remained at 1.22 for a third month.
The manufacturing and trade data are in Haver's USECON database.
| Manufacturing & Trade (%) | Jul | Jun | May | Jul Y/Y | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|---|---|
| Business Inventories | 0.4 | 0.4 | 0.5 | 5.9 | 4.3 | 4.9 | 7.9 |
| Retail | 1.0 | 0.7 | 0.2 | 6.6 | 7.1 | 7.4 | 3.7 |
| Retail excl. Motor Vehicles | 0.4 | 0.3 | 0.0 | 3.5 | 3.8 | 3.2 | 3.5 |
| Merchant Wholesalers | 0.1 | 0.2 | 0.3 | 7.9 | 4.0 | 5.5 | 9.2 |
| Manufacturing | 0.1 | 0.2 | 0.8 | 3.9 | 2.3 | 2.4 | 10.2 |
| Business Sales (%) | |||||||
| Total | 0.8 | 0.6 | 0.3 | 5.3 | 3.4 | 4.5 | 10.9 |
| Retail | 0.6 | 0.3 | 0.4 | 4.8 | 4.3 | 5.0 | 7.7 |
| Retail excl. Motor Vehicles | 0.3 | 0.5 | 0.4 | 4.1 | 3.0 | 4.0 | 7.1 |
| Merchant Wholesalers | 0.7 | 0.4 | 0.7 | 7.5 | 4.3 | 4.8 | 12.4 |
| Manufacturing | 1.2 | 0.8 | -0.1 | 4.3 | 2.0 | 4.0 | 12.1 |
| I/S Ratio | |||||||
| Total | 1.29 | 1.29 | 1.29 | 1.28 | 1.28 | 1.28 | 1.26 |
| Retail | 1.43 | 1.42 | 1.41 | 1.39 | 1.40 | 1.38 | 1.36 |
| Retail Excl. Motor Vehicles | 1.22 | 1.22 | 1.22 | 1.22 | 1.22 | 1.21 | 1.23 |
| Merchant Wholesalers | 1.16 | 1.17 | 1.17 | 1.16 | 1.17 | 1.18 | 1.15 |
| Manufacturing | 1.29 | 1.30 | 1.31 | 1.29 | 1.29 | 1.29 | 1.29 |
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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