The 0.2% U.S. July business inventory rise
The 0.2% U.S. July business inventory rise after a 0.5% June increase tracked estimates, with a 0.1% retail inventory drop that compares to a 0.2% decline from the advance indicator report. Analysts saw the already-reported 0.2% rise for factories and a 0.6% wholesale gain released earlier that beat a 0.4% advance figure. Analysts still expect a Q2 GDP growth boost to 3.1% from 3.0%, with no retail inventory revision alongside boosts of $4 B for factory inventories and $3 B for construction, but downward bumps of $5 B for consumption and $1 B for net exports. Analysts expect Q3 GDP growth of 2.6%, with a $2 B inventory addition after an estimated $4.6 (was $0.6) B Q2 addition that left a lean $5.8 (was $1.8) B accumulation rate. Inventories have yet to recover from the big 2015-2016 petro-hit. Risk for the economy can be seen in the lofty inventory-to-sales (I/S) ratio, which sustained the June rise to 1.38 from 1.37 over the prior six months, versus a 1.42 expansion-high over the three months of Q1 in 2016.