13 May 2005, 17:01  U.S. business inventories seasonally adjusted $1.295 trillion

U.S. business inventories rose 0.4 percent in March, a touch below expectations, while sales advanced 0.7 percent, government data showed on Friday. The Commerce Department said stocks at manufacturers, retailers and merchant wholesalers grew for a sixth straight month to a seasonally adjusted $1.295 trillion. Business sales reached $986.02 billion. Wall Street analysts polled by Reuters had forecast a 0.6 percent March inventory gain. Rising inventories can signal either growing business confidence about future demand or an unexpected sales drop that causes unsold stocks to pile up. Business inventories are also a component of gross domestic product. The smaller-than-expected March inventory rise may prompt economists to reassess their estimates for first-quarter U.S. growth. Some economists had worried that high oil prices could deal a blow to U.S. economic output but unexpectedly strong employment and retail sales figures out this month have allayed those concerns.

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