March 2019 Business Inventories Remain Elevated

Headlines show final business sales data (retail plus wholesale plus manufacturing) improved. However, the rolling averages declined. Inventories remain very elevated. Inflation-adjusted growth is in contraction.

Analyst Opinion of Business Sales and Inventories

Inventories remain at recessionary levels. Our primary monitoring tool - the 3-month rolling averages for sales - declined again but remains in expansion. As the monthly data has significant variation, the 3-month averages are the way to view this series. Overall business sales are better than the low point in 2015 - but over the last 6 months growth is trending down.

Econintersect Analysis:

  • the unadjusted sales rate of growth decelerated 1.1 % month-over-month, and up 1.2 % year-over-year
  • unadjusted sales (but inflation-adjusted) down 1.3 % year-over-year
  • unadjusted sales three-month rolling average compared to the rolling average 1 year ago decelerated 0.2 % month-over-month, and is up 2.1 % year-over-year.

(Click on image to enlarge)

  • unadjusted business inventories growth rate was unchanged month-over-month (up 5.0 % year-over-year), and the inventory-to-sales ratio is 1.36 which is recessionary.

US Census Headlines:

  • seasonally adjusted sales up 1.6 % month-over-month, up 3.7 % year-over-year (published 2.4 % last month).
  • seasonally adjusted inventories were up 0.0 % month-over-month (up 5.0 % year-over-year), inventory-to-sales ratios were up from 1.36 one year ago - and are now 1.37.
  • market expectations (from Econoday) were for inventory growth of 0.0 % to 0.5 % (consensus +0.1 %).

The way data is released, differences between the business releases pumped out by the U.S. Census Bureau are not easy to understand with a quick reading. The entire story does not come together until the Business Sales Report (this report) comes out. At this point, a coherent and complete business contribution to the economy can be understood.

1 2
View single page >> |

Disclaimer: No content is to be construed as investment advise and all content is provided for informational purposes only.The reader is solely responsible for determining whether any investment, ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.