U.S. businesses continue to trim inventories

Still cautious about the economy, businesses continue to reduce excess inventory, as they cut costs and re-align their operations with consumer demand.

Business inventories fell 1.0 percent in July, the U.S. Commerce Department announced Tuesday, led by a decline in retail and manufacturing inventories.

Economists surveyed by Bloomberg News had expected inventories to decline 0.9 percent in July. Inventories fell a revised 1.4 percent in June; they fell 1.0 percent in May and 1.3 in April. What's more, inventories have fallen 11.8 percent in the past year, and have declined for 11 straight months. Retail inventories are now 10.7 percent lower than a year ago; manufacturing inventories, 8.5 percent lower.