Highlights
Even though demand is stabilizing, businesses continue to burn through inventory in an effort to keep costs down and profits up. Business inventories fell 1.0 percent in July following a 1.4 percent draw in June (1.1 percent draw initially reported). Year-on-year rates are deepening, to minus 11.8 percent in July. In contrast to inventories, business sales are up, 0.1 percent higher in July and adding incrementally to June's major 1.1 percent jump, a jump that will be looked back at as a critical pivot for the business cycle.

But again it's still too early for the improvement in sales to trip a rise in inventories. Retail data are the new component in today's report showing a 1.0 percent draw and a 0.6 percent draw excluding autos. Auto production is picking up and will begin to replenish inventories though auto inventories in next month's report for August would appear certain to fall steeply given the big cash-for-clunkers push. With the exception of food & beverages, retailers drew down stocks across components. Continued economic growth will eventually, and hopefully soon, convince businesses to restock their inventories in what will give the labor market a big lift.

Market Consensus Before Announcement
Business inventories fell 1.1 percent in June to extend a long string of declines and reflecting businesses adjusting stocks to match the drop in demand over the recession. For July, early numbers on manufacturing inventories showed a 0.9 percent drop while wholesale inventories declined 1.4 percent. Both will be tugging down on total business inventories for the month with retail inventories being the missing piece of the puzzle.

2009 Release Schedule

Released On: 1/14 2/12 3/12 4/14 5/13 6/11 7/14 8/13 9/15 10/14 11/16 12/11 Released For: Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct