The solid pace of stockpiling the past few months points to inventories making a “sizeable” contribution to the print for Q1 GDP, pointed out analysts at Wells Fargo.
“Business inventories rose 0.6 percent for the third straight month in February. Over the past three months, inventories have growth at a 7.3 percent annualized pace, the fastest clip in five and a half years.”
“Inventory growth has ramped up solidly compared to the Q4 average. We expect the pickup in inventory growth to add about one percentage point to Q1 GDP.
“While consumption looks to have been weak in the first quarter, we expect activity to rebound in Q2 and bring inventories more in line with sales.”
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