U.S. Wholesale Inventories & Sales Rise
Inventories at the wholesale level increased 0.7% during June following a 0.6% May rise, revised from 0.4%. Inventories rose a moderate 2.9% y/y. The latest gain was the strongest in six months.
Durable goods inventories increased 0.5% (3.6% y/y) following a 0.6% rise. Motor vehicle inventories strengthened 1.4% (4.4% y/y), while furniture inventories gained 0.6% (5.9% y/y). (…)
Wholesale sales also increased 0.7% (5.6% y/y) after a 0.1% May slip, revised from -0.5%. A 0.1% rise was expected in the Action Economics Forecast Survey.
Nondurable goods sales jumped 1.4% (5.1% y/y) as petroleum sales gained 1.9% (11.0% y/y). Chemical sales fell 1.9% (+3.2% y/y). Apparel sales declined 1.3% (-8.1% y/y) after a 4.2% jump. Sales of paper products rose 0.8% (4.7% y/y) while grocery product sales increased 0.8% (5.0% y/y). Sales by durable goods wholesalers held steady (+5.8% y/y). Computer sales declined 1.2% (+2.3% y/y), and machinery sales fell 0.8% (+2.2% y/y). Electrical equipment sales strengthened 1.3% (7.1% y/y) while motor vehicle distributors’ sales slipped 0.5% (+9.6% y/y). Furniture sales were off 1.4% (-1.1% y/y).
The wholesalers’ inventory-to-sales ratio rose to 1.29 but fell sharply from 1.32 twelve months earlier.
U.S. Productivity Rose at 0.9% Rate in Second Quarter Nonfarm business-sector productivity increased at a 0.9% seasonally adjusted annual rate
(…) Nonfarm business-sector productivity, a measure of the goods and services produced per hour worked by individuals, rose at a 0.9% seasonally adjusted annual rate in the second quarter compared with the first three months of 2017, up from a 0.1% growth pace in the first quarter.
Compared with a year earlier, which is how economists often look at the longer-term trend, productivity was up 1.2% in the second quarter. That was a pickup from last year, when productivity posted its first calendar-year decline since 1982. It also matched the average pace since 2007, but remained well below the post-World War II average of 2.1% annual growth. (…)
Unit labor costs at nonfarm businesses rose at a 0.6% rate in the second quarter, less than economists had expected. From a year earlier, unit labor costs fell 0.2%. (…)
“If labor productivity grows an average of 2% per year, average living standards for our children’s generation will be twice what we experienced,†Federal Reserve Vice Chairman Stanley Fischer said in a July speech. “If labor productivity grows an average of 1% per year, the difference is dramatic: Living standards will take two generations to double.†(…)
China’s Consumer Inflation Slows Unexpectedly in July China’s consumer inflation slowed a notch in July, with softer non-food prices signaling that economic activity may be cooling as Beijing works to reduce debt levels.
China’s consumer-price index rose 1.4% in July from a year ago, compared with a 1.5% gain in June, the National Bureau of Statistics said on Wednesday.
Food prices, the biggest component of the consumer inflation index, declined 1.1% from the same time a year ago, less steeply than their 1.2% drop in June. Prices of vegetables and eggs rose, driven up by a widespread heat wave and flooding, the statistics bureau said.
Meanwhile, the rate of increase in the price of nonfood items fell to a seven-month low of 2.0% last month, as health care and services became less expensive, the bureau said. (…)
July’s consumer inflationary rate is well below Beijing’s 3% target set for 2017. Some economists said the rate still has room to fall, to around 1%, before affecting monetary policy. (…)
China’s producer-price index stayed unchanged at 5.5% for a third consecutive month in July, and turned positive in month-over-month terms for the first time since March. (…)
- Softer growth in electricity generation could be signaling weaker economic activity. (The Daily Shot)
Source: Dankske Bank, @joshdigga
OPEC Says Crude Output Rose in July OPEC’s crude-oil production rose further in July, in the latest sign the cartel’s efforts to reduce output and drain a global supply glut are falling short.
The Organization of the Petroleum Exporting Countries’ output rose by roughly 0.5%, to 32.87 million barrels a day last month, up by 172,600 barrels from June. The uptick, which was smaller than the prior month’s increase, was driven by higher production in Libya, Nigeria and Saudi Arabia, according to OPEC’s closely watched monthly market report. (…)
Iraq’s output fell 33.1 thousand barrels a day, to 4.5 million barrels a day, while the U.A.E. pulled back by 6.7 thousand barrels a day, to 2.9 million barrels a day. (…)
OPEC’s Thursday report also highlighted non-OPEC oil supply, revising its growth forecast for 2017 down by 28,000 barrels a day, to an average supply growth of 780, 000 barrels a day this year. The report cited a lower assessment of oil supply in developed countries in the Americas as the cause of the revision.
Commercial oil inventories in the Organization for Economic Cooperation and Development—a group of industrialized, oil-consuming nations—stood at 3.03 million barrels, 252 million barrels above OPEC’s target of the last five-year average, the cartel said.
OPEC also raised its forecast for global oil demand growth this year by 100 thousand barrels a day, saying it now expects growth of 1.37 million barrels a day in 2017. For 2018, world demand is projected to grow by 1.28 million barrels a day, compared with 2017 levels, the cartel said.
