• U.S. business inventories rise slightly in may, likely to contribute modestly to Q2 GDP growth

    Source: FxWire Pro - Commentary / 16 Jul 2018 15:21:53   America/New_York

    U.S. business inventories came in line with expectations in May. Business inventories rose 0.4 percent in May with higher stockpiles in every category, especially merchant wholesales, which rose 0.6 percent. The brisk rate of sales implies that this does not seem to be unintended inventory building. In sales, wholesales led the way, with a rise of 2.5 percent in May. Retailers and manufacturers reported rise in in sales as well.

    The ratio of inventories to sales is also another indication of the turnover in stockpiles, noted Wells Fargo in a research report. This measure has been trending lower since the beginning of 2016. In the past couple of years, a comparatively slow, stable build in inventories has translated into uncharacteristically docile pace of change and as a result, inventories have not been a considerable growth driver.

    “We look for a modest boost of less than half a percentage point from inventories in Q2 GDP”, added Wells Fargo.

    At 19:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was slightly bearish at -62.1576. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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