U.S. business inventories rise in November
15/01/2021 15:15
WASHINGTON, Jan 15 (Reuters) - U.S. business inventories
increased in November, supporting expectations that inventory
investment was likely the main driver of economic growth in the
fourth quarter.
Business inventories rose 0.5% in November after increasing
0.8% in October, the Commerce Department said on Friday.
Inventories are a key component of gross domestic product.
November's increase was in line with economists' expectations.
Inventories fell 3.2% on a year-on-year basis in November.
Retail inventories rose 0.7% in November as estimated in an
advance report published last month. That followed a 0.9%
increase in October. Motor vehicle inventories jumped 1.9%
instead of 1.5% as previously reported.
Retail inventories excluding autos, which go into the
calculation of GDP, gained 0.2% instead of 0.3% as estimated
last month.
Businesses are replenishing inventories after they were
drawn down early in the pandemic. That has helped to underpin
manufacturing. Inventory accumulation is expected to blunt some
of the drag on GDP from a widening trade deficit, which hit a
more than 14-year high in November.
The economy grew at a historic 33.4% pace in the third
quarter after shrinking at a 31.4% rate in the April-June
period, the deepest since the government started keeping records
in 1947. Inventories added to GDP growth in the third quarter
after being a drag for five straight quarters.
Growth estimates for the fourth quarter are mostly below a
5% rate because of the outbreak in coronavirus infections and
the largely expired fiscal stimulus.
Wholesale inventories were unchanged in November. Stocks at
manufacturers rose 0.7%.
Business sales slipped 0.1% in November after accelerating
0.9% in October. At November's sales pace, it would take 1.32
months for businesses to clear shelves, unchanged from October.
(Reporting by Lucia Mutikani)
((Lucia.Mutikani@thomsonreuters.com; 1 202 898 8315; Reuters
Messaging: lucia.mutikani.thomsonreuters.com@reuters.net))