US business inventories rose for the eighth straight month in December, the Commerce Department said today. Inventories at retailers, manufacturers and wholesalers grew 0.6pc in December to USD1.143 trillion after a revised rise of 0.3pc a month earlier as firms increased stockpiles amid rising demand. Economists had forecast that inventories would rise by just 0.2pc. On a year-on-year basis, inventories were up 1.9pc, the Commerce Department said.
Business sales rose 0.2pc in December after rising 0.1pc in November, although this was revised down from an initial estimate of 0.3pc. The combination of inventories to sales produced an inventories-to-sales ratio of 1.37 in December, meaning it would take 1.37 months to exhaust the backlog at the December sales pace. Although inventories have risen for the past eight months, they remain historically low due to the uncertainty of future demand caused by the possibility of a war with Iraq. //www.fxcentre.com