U.S. wholesale inventories revised higher in November -Breaking
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© Reuters. FILEPHOTO: ABT Electronics Facility, Glenview, Illinois. Warehouse workers handle inventory that has been stacked high to the ceiling. REUTERS/Richa NaiduWASHINGTON (Reuters] – The U.S. Wholesale inventories rose more in November than was initially believed, suggesting that restocking warehouses may have contributed to the quarter’s economic growth.
On Monday, the Commerce Department reported that wholesale inventories rose 1.4% instead of 1.2%. This is in contrast to what was estimated for last month. In October, wholesaler stock increased 2.5%
Reuters polled economists and found that they expected inventory levels to remain unchanged. In November, wholesale inventories jumped 15.9% over the same period last year.
Inventories make up a significant part of the gross domestic product.
After rising 2.8% by October, motor vehicle inventories rose 2.7%. Motor vehicle production is still limited by a worldwide shortage of semiconductors.
The November increase in wholesale inventories (autos excluded) was 1.2%. This part is included in the calculation of GDP.
The bulk of 2.3% annualized GDP growth was due to slower inventory drawdown during the third quarter. The first half year saw inventories decline and COVID-19-related shortages make it difficult to replenish them.
While the immediate need to replenish stock is vital for manufacturing, there are worries among economists that firms wary of delaying getting stock may order too much, which could lead to excess inventory and a slowdown in economic expansion.
Wholesaler sales saw an increase of 1.3%, after October’s acceleration to 2.5%.
It would take wholesalers 1.22 years to clear the shelves at November’s current sales rate, which was unchanged from October.
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