2018 Economic Calendar
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Business Inventories  
Released On 7/16/2018 10:00:00 AM For May, 2018
PriorConsensusConsensus RangeActual
Inventories - M/M change0.3 %0.4 %0.3 % to 0.4 %0.4 %

Inventories are rising which is an immediate positive for GDP and they're behind the strength in sales which is a future positive for both production and employment. Business inventories rose an as-expected 0.4 percent in May against, however, a 1.4 percent surge in business sales. The mismatch pulls the inventory-to-sales ratio down a notch to 1.34 vs 1.35 in April and March. Looking at year-on-year comparisons, inventories are up 4.4 percent while sales are up 8.6 percent.

Sales data in May are led by wholesalers and retailers with wholesalers showing the largest inventory build. These results call to mind last week's producer price report where trade services, which track costs at retailers and wholesalers, showed clear prices pressures. Sales are very strong right now and businesses may be having trouble keeping up with the demand.

Consensus Outlook
A healthy 0.4 percent increase is the consensus for business inventories in May, a constructive build that would nevertheless be too low given the strength of underlying sales.

Business inventories are the dollar amount of inventories held by manufacturers, wholesalers, and retailers. The level of inventories in relation to sales is an important indicator of the near-term direction of production activity.  Why Investors Care
Inventories relative to sales, as tracked by the inventory-to-sales ratio, tend to fall when sales are strong and tend to rise when sales are weak. A low reading for the ratio indicates that inventory conditions are lean while a high reading may indicate that inventory growth is unwanted.
Data Source: Haver Analytics

2018 Release Schedule
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