The US Census Bureau is reporting this morning that manufacturing and trade inventories dropped in September 0.4% from August and 0.3% from September, 2008. Sales and shipments fell 0.3% from August and 0.6% from September 2008. The inventory to sales ratio was 1.32, event with September 2008. This ratio means it would take 1.32 months for factories to exhaust stockpiles.
The rate of inventory accumulation plays a key role in determining the current pace of economic growth and often provides useful clues about the future pace of growth as well. For example, if inventories are accumulating at a rapid pace, such that inventory sales ratios are rising, it may portend a slowing of growth in the near future as firms cut production to bring inventories back into line with sales. Vice versa, if inventories are growing slowly or actually falling, it may signal a future pickup in production
No comments:
Post a Comment
All comments are moderated before being posted. Postings are at the sole discretion of the blog moderator. Anonymous postings are no longer allowed. I encourage your comments, but put you name on the bottom line!