WASHINGTON (Reuters) – U.S. business inventories rose marginally in November, suggesting that restocking will probably not contribute to economic growth in the fourth quarter.
Inventories ticked up 0.1% after being unchanged in October, the Commerce Department’s Census Bureau said on Thursday. The slight rise in inventories, a key component of gross domestic product, was in line with economists’ expectations.
Inventories increased 2.6% on a year-on-year basis in November. The pace of inventory accumulation could pick up in the months ahead as businesses stockpile goods in anticipation of higher import tariffs. President-elect Donald Trump, who will be inaugurated next week, is planning broad tariffs on goods.
Inventories and trade are the most volatile components of GDP. Private inventory investment was a small drag on GDP in the third quarter. The economy grew at a 3.1% annualized rate in the third quarter. The Atlanta Federal Reserve is forecasting GDP to have increased at a 2.7% rate in the fourth quarter.
Retail inventories gained 0.2% in November rather than 0.3%, as estimated in an advance report published last month. They also increased 0.2% in October.
Motor vehicle inventories slipped 0.3% instead of the previously reported 0.4%. They were unchanged in October.
Retail inventories excluding autos, which go into the calculation of GDP, increased 0.5%, instead of the previously reported 0.6%. They advanced 0.3% in October.
Wholesale inventories fell 0.2% in November, while stocks at manufacturers increased 0.3%.
Business sales rose 0.5% in November after being unchanged in October. At November’s sales pace, it would take 1.37 months for businesses to clear shelves, unchanged from October.
