U.S. business inventories beat expectations in February

div classBodysc17zpet90 cdBBJodivpWASHINGTON Reuters – U.S. business inventories increased more than expected in February amid a moderation in sales, data showed on Thursday.p

pBusiness inventories rose 1.5 after climbing 1.3 in January, the Commerce Department said. Inventories are a key component of gross domestic product. Economists polled by Reuters had forecast inventories rising 1.3. pdivdivdiv classBodysc17zpet90 cdBBJodiv

pInventories jumped 12.4 on a yearonyear basis in February. Retail inventories increased 1.2 in February, instead of 1.1 as estimated in an advance report published last month. That followed a 2.0 rise in January.p

pMotor vehicle inventories rose 0.9 as estimated last month. They increased 2.7 in January. Retail inventories excluding autos, which go into the calculation of GDP, climbed 1.4, rather than 1.2 as estimated last month.p

pInventory investment surged at a robust seasonally adjusted annualized rate of 193.2 billion in the fourth quarter, contributing 5.32 percentage points to the quarters 6.9 growth pace. Most economists see further scope for inventories to rise, noting that inflationadjusted inventories remain below their prepandemic level. Salestoinventory ratios are also low.p

pBusinesses are restocking after drawing down inventories from the first quarter of 2021 through the third quarter. Growth estimates for the first quarter are around a 1.0 rate.p

pWholesale inventories increased 2.5 in February. Stocks at manufacturers gained 0.6.p

pBusiness sales rose 1.0 in February after rebounding 4.1 in January. At Februarys sales pace, it would take 1.26 months for businesses to clear shelves, down from 1.25 months in January.p