Despite the continued increase on raw materials shortages, US business inventories experienced strong growth during the month of June, rising by 0.8%. This follows a 0.6% rise in May.
While motor vehicle retailers continue to face restocking difficulties, resulting in a 0.3% inventory decrease, other inventories enjoyed stable gains. Retail inventories were the big winners during June, experiencing an increase of 0.5%, just shy of the 0.6% predicted by analysts. Other strong performers included wholesale inventories, which grew by 1.1%, manufacturers’ stock, which rose by 1%, and business sales that increased by 1.4%.
At the heart of the inventory troubles faced by motor vehicle retailers is the ongoing global semiconductor shortage, which has led to lower auto production and the decline of retail sales and stock prices.
The US government reported that last month, consumer spending had increased drastically. This comes after the country’s COVID-19 vaccination rollout has resulted in more freedom of movement and the increased demand for an array of goods and services.
As a result of double-digit growth in consumer spending last quarter, the nation’s GDP has finally risen above its peak in the fourth quarter of 2019.
