Business Inventories Rise For Second Straight Month

Inventories look to a be a big contributor to first-quarter GDP, rising in February by 0.6 percent for a second straight month and comparing with a third-quarter monthly average build of 0.3 percent. And the gain is roughly in line with sales growth as the stock-to-sales ratio remained unchanged in the month at 1.35.

The biggest build is at wholesalers, up 1.0 percent in February with retailers up 0.4 percent and manufacturers up 0.3 percent. It will be interesting to watch whether manufacturing data for March show any tariff-related stockpiling of metals. That aside, inventories are on the rise in line with underlying demand which is a good mix for the economy.