In what is likely to provide a big boost to second quarter GDP numbers, wholesale and retail inventories surged in June according to Advance Indicators from the Census Department. The advance numbers also point to a narrowing of the trade deficit which will add a small bit to second quarter GDP.

Advance Indicators

Advance Trade

Advance Inventories

This inventory build is unwarranted in light of actual retail sales. These numbers will likely boost second quarter GDP substantially. Expect a substantial payback in the third quarter.

I will have an estimate later today.

Mike “Mish” Shedlock