Wholesale inventories in the U.S. rose 0.4% in December, the government reported Thursday. and added to strong gross domestic product in the fourth quarter.
Inventories are goods produced for sale that have not been sold yet. Businesses tend to increase inventories when sales a rising. Sales in the month jumped 0.7%.
The inventory-to-sales ratio was flat at 1.34 months . A year ago the ratio stood at a much higher 1.40.
The ratio reflects how long it would take a company to sell all the goods sitting on warehouse shelves. The lower readings vs. last year suggests it’s taking less time for companies to sell their goods.
Companies also trimmed production a bit to make sure they don’t get stuck with unwanted goods.
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