Retail inventories surged 0.8 percent in September while sales came in flat, in turn raising the inventory-to-sales ratio to 1.48 from 1.47 for the highest of the recovery. Ratios across most retail subcomponents moved incrementally higher.
This report's other two components, which were previously released, include a 0.4 percent decline for factory inventories and a 0.5 percent rise for wholesales inventories.
Had this morning's retail sales report for October proved stronger, the September build for retail inventories would be no concern. But the October sales report proved soft, raising the risk that retailers may be over-estimating holiday demand.
Recent History Of This Indicator:
Business inventories are expected to come in unchanged in September after showing no change in August. But relative to sales, which fell 0.6 percent, inventories in August turned higher with the inventory-to-sales ratio at 1.37 from 1.36 in July and compared with 1.30 in August last year. Inventories, though showing little absolute change, are nevertheless heavy and risk slowing production and employment growth.
Business inventories are expected to come in unchanged in September after showing no change in August. But relative to sales, which fell 0.6 percent, inventories in August turned higher with the inventory-to-sales ratio at 1.37 from 1.36 in July and compared with 1.30 in August last year. Inventories, though showing little absolute change, are nevertheless heavy and risk slowing production and employment growth.
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