US business inventories rebound in April
Inventories increased 0.3% after dipping 0.1% in March
US BUSINESS inventories rebounded in April, potentially setting up inventory investment to contribute to economic growth this quarter after being a drag since the fourth quarter.
Inventories increased 0.3 per cent after dipping 0.1 per cent in March, the Commerce Department’s Census Bureau said on Tuesday (Jun 18). The rebound in inventories, a key component of gross domestic product, was in line with economists’ expectations.
Inventories rose 1.0 per cent year-on-year in April. Private inventory investment has been a drag on GDP for two straight quarters, slicing off 0.45 percentage point from growth in the January-March quarter, the government reported last month.
The economy grew at a 1.3 per cent annualised rate in the January-March quarter, the slowest pace in nearly two years.
Businesses have been carefully managing stocks amid an uncertain economic outlook. Strong domestic demand has also contributed to the relatively low inventory level.
Retail inventories increased 0.7 per cent in April as estimated in an advance report published last month. They gained 0.1 per cent in March. Motor vehicle inventories shot up 1.6 per cent, revised up from the previously estimated 1.5 per cent increase.
They climbed 1.3 per cent in March. Retail inventories excluding autos, which go into the calculation of GDP, rose 0.3 per cent as reported last month. They fell 0.4 per cent in March.
Wholesale inventories edged up 0.1 per cent in April, while stocks at manufacturers also inched up 0.1 per cent.
Business sales rose 0.3 per cent in April after slipping 0.2 per cent in March. At April’s sales pace, it would take 1.37 months for businesses to clear shelves, unchanged from March. REUTERS
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