Inventories at US wholesalers grew a seasonally adjusted 0.5pc in October, the fastest growth this year, the Commerce Department said today. Sales at wholesalers increased 2pc, the biggest gain in more than four years, driven by a 14.5pc increase in farm products. With sales growing faster than inventories, the inventory-to-sales ratio fell to a record low 1.18. Firms have been tightening their inventories as much as possible to keep costs down while not losing sales because they can't deliver goods on time.
Economists expect inventory rebuilding to have a major impact on the economy in the fourth quarter and beyond, as businesses seek to replenish their lean stockpiles to meet growing demand for goods. September's inventory gain was revised down to 0.3pc from 0.4pc. Wholesale sales are up 6.6pc in the past 12 months, while inventories have increased just 1.9pc. Durable goods sales rose 1.8pc in October, while inventories rose 0.4pc. Nondurable goods sales rose 2.2pc while inventories increased 0.8pc.//www.fxcentre.com