Businesses boost inventories as sales slow
American businesses restocked their shelves and warehouses at a faster pace in December, but sales slowed — a cautionary sign for the economy.
The Commerce Department said Thursday that inventories rose 0.5 percent after a 0.4 percent increase in November. Sales growth fell to just 0.1 percent, from 0.7 percent in November.
The figures point to a risk for the economy: If companies build their stockpiles at a faster pace than their sales are growing, they may end up stuck with more goods than they need.
That would force them to cut prices sharply to clear the extra inventory. Businesses would likely order fewer goods, weighing on factory production.
Retailers' stockpiles rose 0.6 percent, while their sales were flat in December, the report said. Manufacturers and wholesalers increased their inventories by a smaller amount. Manufacturers' sales fell, while wholesalers' sales rose at a slower pace than in November.
A separate report Thursday showed that retail sales fell 0.4 percent in January as extremely cold weather kept shoppers at home. Auto sales fell sharply.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Healthy PA expands number of recipients but cuts benefits
- Gas drilling company withdraws application for forced pooling in Western Pennsylvania
- Hershey unwraps new corporate logo
- Cadillac faces SUV challenge
- Fiat-Chrysler shares may hit market soon
- Google tests Project Wing drone delivery
- Trib 30 stock index gains 4.85% in August
- Consumer sentiment improves slightly in August
- Government approves compromise on Corbett’s alternative Medicaid plan
- S&P races to August milestone
- Dairy Queen victim of malware attack