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Tags: Financial Markets | Infrastructure | Money | business inventories

US Business Inventories Rise Solidly in September

hardware store shopper, stocked shelves
(Dreamstime)

Tuesday, 16 November 2021 10:24 AM

U.S. business inventory accumulation increased solidly in September, but motor vehicle retailers continued to struggle to restock amid an ongoing global semiconductor shortage, which has undercut production.

Business inventories rose 0.7% after rising 0.8% in August, the Commerce Department said on Tuesday. Inventories are a key component of gross domestic product. September's increase was in line with economists' expectations.

Inventories increased 7.5% on a year-on-year basis in September. Retail inventories slipped 0.2% in September as estimated in an advance report published last month. That followed a 0.2% gain in August. Motor vehicle inventories slumped 2.9% instead of 2.4% as estimated last month.

Retail Inventories Rise 0.7% -- Slightly Ahead of Expectations

Retail inventories excluding autos, which go into the calculation of GDP, increased 0.7%, instead of 0.6% as estimated last month.

A slower pace of inventory decline in the third quarter accounted for all of the 2.0% annualized increase in GDP growth last quarter. COVID-19 pandemic-related shortages are making it difficult for businesses to rebuild depleted stocks.

Restocking is expected to underpin manufacturing and economic growth in the fourth quarter. Wholesale inventories rose 1.4% in September. Stocks at manufacturers gained 0.8%.

Business sales surged 0.9% in September after edging up 0.1% in August. At September's sales pace, it would take 1.26 months for businesses to clear shelves, unchanged from August.

© 2022 Thomson/Reuters. All rights reserved.


StreetTalk
U.S. business inventory accumulation increased solidly in September, but motor vehicle retailers continued to struggle to restock amid an ongoing global semiconductor shortage, which has undercut production.
business inventories
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2021-24-16
Tuesday, 16 November 2021 10:24 AM
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