US business inventories rose 0.6pc in February, according to figures released today by the Commerce Department. This is the tenth consecutive monthly rise in inventories and was higher than forecast, with most analysts tipping an increase of 0.4pc. Economists at JP Morgan said inventory investment would provide a modest boost to Q1 GDP growth. Inventories rose a revised 0.3pc in January, up slightly from the initial estimate of a 0.2pc gain. Business sales fell 1.0pc in February. This is the largest decrease in sales since November 2001. Sales rose a revised 1.3pc in January, up from the initial estimate of a 1.2pc gain.
The combination of inventories to sales produced an inventories-to-sales ratio of 1.38 in February, meaning it would take 1.38 months to exhaust the backlog at the February sales pace. This is marginally higher than the record low of 1.35 set last April. Year-on-year, inventories were up 3.2pc in February, while sales rose 4.1pc. All subcategories of inventories increased in February. //www.fxcentre.com