U.S. business inventories increase for second straight month in August

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By Reuters Staff2 Min ReadFILE PHOTO: Warehouse workers deal with inventory stacked up to the ceiling at an ABT Electronics Facility in Glenview, Illinois, U.S. December 4, 2018. Picture taken December 4, 2018. REUTERS/Richa NaiduWASHINGTON (Reuters) – U.S. business inventories increased for a second straight month in August, suggesting restocking could blunt the hit to economic growth in the third quarter from a widening trade deficit.Business inventories rose 0.3% in August after edging up 0.1% in July, the Commerce Department said on Friday. Inventories, a key component of gross domestic product, increased in July after six straight monthly declines.Economists polled by Reuters had forecast business stocks rising 0.4% in August.Retail inventories increased 0.4% in August instead of 0.8% as estimated in an advance report published last month. That followed a 1.2% rebound in July. Motor vehicle inventories rose 0.3% rather than 0.6% as previously reported. Retail inventories excluding autos, which go into the calculation of GDP, increased 0.5% instead of 0.9% as estimated last month.An inventory drawdown contributed to GDP declining at a record 31.4% annualized rate in the second quarter. Inventories subtracted 3.5 percentage points from GDP, the most since the first quarter of 1988. They have been a drag on GDP for five straight quarters. The economy fell …

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