U.S. business inventories increased 0.6 percent in July, according to the latest release from the Commerce Department. The increase was driven in part by a jump in the stock of motor vehicles that was larger than initially estimated.
The Manufacturing and Trade Inventories and Sales report estimated the combined value of distributive trade sales and manufacturers’ shipments for July at $1,454.1bn, up 0.2 percent from June 2018 and up 8.1 percent from July 2017. The report estimated manufacturers’ and trade inventories at $1,950bn, up 4.3 percent from July of last year.
Retail inventories increased 0.5 percent in July, up from the 0.4 percent previously reported. Wholesale inventories rose 0.6 percent.
Motor vehicle inventories were up 1.2 percent in July rather than the 1 percent reported in August.
The strength of domestic demand is expected to prompt businesses to increase their inventories of goods. Third-quarter gross domestic product growth could likewise see a bump from inventory accumulation, economists said. The economy saw inventory liquidation in the second quarter.
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