Business Inventories Rise Slightly Relative to Sales

Inventories, up 0.3 percent in September, rose a bit relative to sales, which were unchanged, but not enough to shake up the inventory-to-sales ratio which held steady at 1.30. Retail inventories did pile up slightly, to an inventory-to-sales ratio of 1.42 vs 1.41 in August. But this morning's solid retail sales report for October points to easing for this ratio in this report next month. Ratios in the report's other two components were unchanged, at 1.30 for manufacturers and 1.19 for wholesalers. The nation's inventories right now look balanced especially going into what, based on this morning's surge in consumer sentiment, looks to be a positive holiday shopping season.

Recent History Of This Indicator:
Business inventories rose 0.2 percent in August in contrast to a 0.4 decline for business sales. Yet the mismatch was not enough to the raise the stock-to-sales ratio which held at 1.29. The latest report included August inventory data from the retail sector where the September sales report showed broad contraction. Retail inventories actually thinned in August on a total dollar basis and also relative to sales with the sector's stock-to-sales ratio dipping to 1.41 from 1.43.