Business inventories are edging up as sales head increasingly higher, according to a Commerce Department report for November (link opens as PDF) that was released today.
Seasonally adjusted sales increased 0.8% to $1,318 billion during the month, due primarily to 1% growth for both manufacturers and merchant wholesalers. Comparing November 2012 to November 2013, a 5.5% spike in merchant wholesaler sales provided the main push behind a 4% gain for overall business sales. Manufacturer sales are up 2.6% from November 2012 to November 2013, while retailers added 4.1%.
Month-to-month, inventories expanded a seasonally adjusted 0.4% in November to $1,700 billion, slightly beating analysts' 0.3% expectation. Retail inventories grew 0.8% and merchant wholesalers increased supplies by 0.5%, but manufacturers' inventories stayed steady from October. From November 2012 to November 2013, overall inventories are up 4%.
To understand the rate at which goods are being made and sold, economists compute an inventories/sales ratio. Since sales and inventories increased by relatively comparable amounts from October to November, the inventories/sales ratio remained at 1.29, also the same ratio as November 2012.
Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.