U.S. business inventories beat expectations in February -Breaking
WASHINGTON (Reuters] – U.S. inventory increased in February despite a slowdown in sales.
According to the Commerce Department, inventories in businesses rose 1.5% following an increase of 1.3% in January. Gross domestic product is a major component. Reuters polled economic experts and forecast inventories increasing by 1.3%.
In February, inventories climbed 12.4% year-over-year. According to an advance report last month, retail inventories rose 1.2% instead of 1.1% in February. This follows a January increase of 2.0%.
Motor vehicle inventories rose 0.9% as estimated last month. They increased 2.7% by January. They increased 1.4% in January, but not 1.2% last month, when they were excluded from the calculation of GDP.
In the fourth quarter of 2018, inventory investment soared at a strong seasonally adjusted annualized pace of $193.2 Billion, which was 5.32 percentage point more than the quarter’s 6.9% rate. Economists believe inventories can rise further, noting that inflation adjusted inventories are still below pre-pandemic levels. Low sales-to-inventory ratios also exist.
Companies are replenishing inventories after reducing them from the first to third quarters of 2021. The 1.0% growth rate is expected for the first quarter.
In February, wholesale inventories grew 2.5% Manufacturer stocks increased 0.6%
The February sales of businesses rose by 1.0% after rebounding at 4.1% in January. It would take businesses 1.26 months to get their stock cleared, compared with 1.25 months in January.