WASHINGTON — The value of business inventories in August were up 0.5%, slightly below the 0.6% increase expected by analysts, data released by the Commerce Department Monday morning showed.
Retail inventories rose 0.7%, unrevised from the gain in the advance estimate. Data from the wholesale inventory report showed a 1.0% rise in the month, which was revised up from the 0.8% gain in the advance report, while factory inventories were down 0.1%.
According to an MNI calculation, if a 1.8% increase in motor vehicle inventories had been excluded, total business inventories would have been up 0.3% in August. The increase in motor vehicles inventories was revised down from a 2.0% gain in the advance estimate.
After excluding the increase in motor vehicle inventories, the remaining retail categories were flat, revised down from the advance estimate. There were increases for most categories, slightly offset by a 0.2% decline in department stores.
The relatively large unpublished retail category fell 0.6% following a 0.6% decrease in July, according to an MNI calculation.
August business sales posted a 0.5% increase in the month, in line with the 0.5% rise forecast by MNI after the wholesale data were released, but before the downward revision to August retail trade sales released earlier Monday morning.
Retail sales excluding food services were flat in August, revised down from the 0.1% gain reported last month. There was a previously announced 0.5% gain for factory shipments, which are equal to sales in this report, and wholesale sales.
The inventory-to-sales ratio unchanged at 1.34 in August due to the similar gains in sales and inventories this month. The ratio remains well below the 1.39 level seen in August 2017, as sales growth has sharply outpaced inventory growth over the last year.
The August growth in business inventories is a positive factor for the third quarter, but it remains to be seen whether inventory growth slows over the next month.
