Business Inventories Rise, In Line With Business Sales

Business inventories rose 0.4 percent in July and largely in line with business sales which rose 0.3 percent. This combination keeps the inventory-to-sales ratio unchanged at a favorable 1.40.

Among the headline's three components, inventories at both manufacturers and wholesalers rose 0.2 percent with retailers up 0.8 percent though sales at retailers matched the inventory build with an 0.8 percent sales increase. Sales at manufacturers slipped 0.2 percent with sales at wholesalers up 0.3 percent.

The headline build for today's report gets inventories off to a positive start for third-quarter GDP and, given the steady growth in sales, do not point to the risk that higher inventories are unwanted.