Another quiet day, but also one in which we got more opportunity to track the modest supply-squeeze showing up in US distribution channels. It came with two sets of data: the wholesale sales & inventory data for July, which cut the inventory/sales ratio back to the levels we've been used to since 4Q2018, with the ratio for durable goods falling hard and generally.
And in addition, we got a modest inflation shock from August's PPI, not least because retailers and wholesalers responded to the supply squeeze by widening their margins.
These strange post-pandemic dynamics won't last long, but the current modest supply squeeze can be expected to produce strong US industrial and NE Asian export numbers for a few months yet.
