U.S. Business Inventory Levels Remain Steady

Written by Emily J. Thompson, Senior Investment Analyst

Updated: Nov 25 2025

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U.S. Business Inventory Trends: In August, U.S. business inventories remained flat, following a slight gain in July that fell short of expectations, with retail inventories also declining by 0.1%.
Impact of Tariffs and Inventory Ratios: The weak inventory figures are attributed to a "front running" surge in trade due to anticipated tariffs, contrasting with previous inventory increases before last year's port strike.
Business Inventory to Sales Ratio: The inventory-to-sales ratio dropped to a 39-month low of 1.37 in August, down from a one-year high of 1.41 earlier in 2024, indicating a significant shift in inventory management.
GDP Growth Estimate Adjustment: Analysts revised the Q3 GDP growth estimate down to 2.8% from 3.0%, factoring in a $7 billion inventory subtraction, with an estimated liquidation rate of $25 billion in Q3.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.