(RTTNews) - Monday morning, the Commerce Department released its report on total business inventories in the month of September, showing that inventories decreased by less than economists had been anticipating.

The report showed that inventories fell by 0.4 percent in September following a revised 1.6 percent decrease in August. Economists had been expecting inventories to decrease by 0.7 percent compared to the 1.5 percent drop originally reported for the previous month.

A jump in inventories of motor vehicles and parts contributed to the smaller than expected drop in business inventories, with inventories at motor vehicles and parts dealers surging up by 3.8 percent in September after falling by 8.0 in August.

The increase in inventories at motor vehicles and parts dealers contributed to a 0.6 percent increase in inventories at retailers in September, which followed a 2.6 percent drop in August.

At the same time, manufacturers said inventories fell by 1.0 percent in September after falling by 0.9 percent in August and merchant wholesales said inventories declined by 0.9 percent following a 1.3 percent decrease in the previous month.

The report also showed that business sales fell by 0.3 percent in September following a 1.1 percent increase in August.

The drop in business sales came as a 2.6 percent drop in sales by retailers more than offset increases in sales by manufacturers and merchant wholesalers, which rose by 0.8 percent and 0.6 percent, respectively.

With inventories and sales falling at roughly the same rate, the total business inventories/sales ratio came in at 1.32 in September, unchanged from August and the same month a year ago.

Peter Boockvar, equity strategist for Miller Tabak, said, “As Business Inventories were estimated in the Q3 GDP report, today’s better than expected figure will lift GDP estimates by .2-.3% and partially offsets the drag that the higher than expected Sept. trade deficit brought last week.”

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Posted in Categories: Economy, Forex, Releases, USA.

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