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Economy in Brief

U.S. Wholesale Inventory Accumulation Rate Intensified Last Year
by Tom Moeller  February 10, 2015

Inventories at the wholesale level during all of last year increased 6.7%, the fastest rate since 2011. During December, however, the gain slipped back to just 0.1% after an unrevised 0.8% jump in November. Durable goods inventories rose 7.8% last year after a 5.7% 2010 increase. For December alone, inventories of durables gained 0.2%. Motor vehicle inventories increased 0.2% y/y and furniture inventories rose 1.2% (5.4% y/y). These gains were offset by a 1.7% decline (+4.8 y/y) in electrical equipment inventories. Nondurable goods inventories increased 4.9% last year despite a 19.1% drop in petroleum with lower prices. For December, nondurables inventories slipped 0.1% (+4.9% y/y), held back by a 6.2% drop in petroleum. Apparel inventories also were off by 0.6% (+5.5% y/y). A 3.4% increase (1.1% y/y) in chemical inventories offset these declines.

Wholesale sales increased 5.0% last year after a 4.4% rise in 2013. Durable goods sales increased 5.8% on top of a 4.2% rise. For December alone, wholesale sales overall fell 0.4% (+1.4% y/y) held back by a 13.7% drop (-29.4% y/y) in petroleum sales. Apparel sales also were off by 1.5% (+7.4% y/y). Working the other way, sales of electrical equipment soared 3.4% (13.4 y/y) and chemical sales increased 2.3% (3.9% y/y). Motor vehicle sales improved 0.4% (6.1% y/y).

The inventory-to-sales ratio at the wholesale level rose to 1.19 from 1.17 in 2013. In December the ratio rose to 1.22, its highest since 2009. The durable goods I/S ratio rose to 1.57 in December but was fairly steady during the year. The nondurable ratio gained to 0.89 in December and to 0.85 for the year, despite a decline in petroleum to 0.31 for the whole year from 0.35.

The wholesale trade figures are available in Haver's USECON database.

Wholesale Sector - NAICS Classification (%) Dec Nov Oct Y/Y 2014 2013 2012
Inventories 0.1 0.8 0.6 6.7 6.7 4.3 5.5
Sales -0.4 -0.4 -0.0 1.4 5.0 4.4 4.8
I/S Ratio 1.22 1.21 1.20 1.16 (Dec.'13) 1.19 1.17 1.18
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