Retail And Wholesale Inventories Both On The Rise In December

Retail inventories rose 0.2 percent in December as a 0.4 percent draw in vehicle inventories offset a 0.6 percent build in non-vehicle inventories. The draw in vehicle inventories is the fourth straight which reflects the strength of vehicle sales and is a major positive for first-quarter production and employment in the vehicle sector. Note that today's data are incorporated into this morning's GDP report where a slowing in inventory build held down the fourth quarter's headline result.

Recent History Of This Indicator:
Retail inventories are expected to rise 0.1 percent in December in what would follow a 0.1 percent increase in November and no change for October. Flat inventories in retail look to hold down fourth-quarter GDP. 

...meanwhile...

Wholesale inventories rose 0.2 percent in December as a moderate 0.4 percent build for durable goods was offset by a 0.2 percent draw in nondurable goods. The limited inventory build, though a negative for GDP, is actually healthy given the strength of demand and the need to rebuild inventories which will be a positive for first-quarter production and employment. Note that today's data are incorporated into this morning's GDP report where a slowing in inventory build held down the fourth quarter's headline result.

Recent History Of This Indicator:
Wholesale trade inventories are expected to rise a constructive 0.3 percent in December following a large 0.8 percent build in November that, for fourth-quarter GDP, is offset in part by a 0.4 percent draw in October. Sales at the wholesale level have been very strong, up 1.5 and 0.8 percent in November and October which do point to the need for restocking. Gains for wholesale inventories would be a positive for GDP and would help offset what have been flat inventory readings for retailers