U.S. Business Inventories Ease as Sales Increase in December
by:Tom Moeller
|in:Economy in Brief
Summary
- Inventories slip, paced by retailer & wholesale sectors.
- Sales improvement is broad-based.
- Inventory/sales ratio falls.
Total business inventories fell 0.2% (+2.0% y/y) in December following little change during the prior three months. A 0.1% easing was expected in the Action Economics Forecast Survey.
Retail inventories fell 0.4% (+5.6% y/y) in December after a 0.1% November increase. Motor vehicle inventories fell 1.1% (+11.6% y/y) after falling 0.8% in November. General merchandise inventories rose 0.2% (2.4% y/y) after a 0.4% gain. Food and beverage store inventories edged 0.1% higher (2.3% y/y) following a 0.2% increase. Furniture & appliance inventories declined 0.8% (-2.9% y/y) after easing 0.1%. Clothing inventories fell 1.2% (+1.2% y/y) after the same decline in November while inventories of building materials rose 0.8% (5.2% y/y) after a 1.6% gain.
Manufacturing inventories moved 0.4% higher (0.8% y/y) in December the same as during November. Wholesale inventories fell 0.5% (-0.1% y/y) in December, the fourth consecutive month of decline.
Total business sales rose 0.8% (3.1% y/y) in December after a 0.6% November gain. Factory shipments rose 0.6% (1.9% y/y) after a 0.1% gain. Wholesale sales rose 1.0% (2.8% y/y) following a 0.9% increase. Retail sales increased 0.8% (4.5% y/y) following a 0.7% rise.
The inventory/sales (I/S) ratio eased to 1.35 in December, its lowest level since September 2013. The manufacturing I/S ratio slipped to 1.46 in December from 1.47 in November. The wholesale I/S fell to 1.31, down from a 1.40 high in June 2023. The retail I/S ratio fell to 1.30 from 1.32 in November.
The manufacturing and trade data are in Haver’s USECON database. The Informa Global Markets forecast is in the MMSAMER database.
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.
More Economy in Brief
Global