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Economy in Brief
U.S. Mortgage Applications Continued to Slide Amid Higher Rates
The biggest declines have been in refinancing activity, while applications for purchase are just starting to crack...
UK Inflation Jumps
Inflation is at the highest rate since the series began in January of 1989...
U.S. Industrial Production Much Stronger than Expected in April
The increase in manufacturing output in April was once again led by motor vehicle and parts production...
U.S. Retail Sales Posted Solid Rise in April
Notwithstanding falling real incomes and declining confidence measures, consumer spending posted a solid increase...
U.S. Home Builder Index Took a Steep Drop in May
This is the fifth straight month that builder sentiment has declined...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
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Why Have the Yields on TIPS Been Negative in the Past Two Years?
"Core" GDP Suggests Economy Gained Momentum in Q1:2022
by Tom Moeller August 9, 2018
Wholesale trade inventories inched 0.1% higher (5.1% y/y) in June following a revised 0.3% May rise, initially reported as 0.6%. The increase compared to m/m stability expected by the Informa Global Markets Survey axnd followed a 0.1% decline indicated in the advance report two weeks ago.
Durable goods inventories rose 0.8% last month (6.2% y/y) following a 0.3% rise. Machinery inventories, the largest sector, increased 0.8% (7.7% y/y), while motor vehicles & parts, the second largest, declined 1.2% (+0.2% y/y). Electrical equipment inventories grew 0.5% (7.8% y/y). Inventories of nondurable goods declined 1.0% (+3.3% y/y) following a 0.4% rise. Drug inventories, which make up a quarter of nondurable inventories, fell 0.8% and were roughly unchanged y/y. Groceries inventories, the second largest category, also were fairly steady (-0.6% y/y). Petroleum inventories declined 0.8% (+15.6% y/y). Apparel inventories eased 1.1% (-4.2% y/y), down for the third straight month.
Sales at the wholesale level eased 0.1% (+10.2% y/y) in June after a little-revised 2.1% May increase. A 0.6% June rise had been expected in the Action Economics Forecast Survey.
Durable goods sales increased 0.2% (9.9% y/y) after two months of strong increase. Sales of electrical equipment, the largest sector, rose 1.9% (7.2% y/y) after one month of stability. Professional and commercial equipment sales, which includes computers, fell 2.2% (+7.5% y/y), while vehicle sales edged 0.4% higher (10.1% y/y). Nondurable product sales eased 0.3% (+10.6% y/y) after three months of strong increase. Petroleum product sales, the largest category, rose 1.2% (46.1% y/y) fueled by higher prices. Drug store sales fell 0.5% (+3.4% y/y) while grocery store sales fell 0.4% (-3.9% y/y). Sales of apparel inched 0.1% higher (5.5% y/y) and chemical sales strengthened 1.6% (15.1% y/y).
The inventory-to-sales (I/S) ratio at the wholesale level held m/m at 1.25 in June and it remained the lowest level since November 2014.
The I/S ratio for durable goods increased to 1.58 from 1.57 which was the lowest since November 2013. The machinery ratio declined to a six-year low of 2.54 while motor vehicles dropped to 1.53, a four-year low. The I/S ratio for nondurable goods declined to 0.94 the lowest since December 2014. The petroleum industry I/S ratio slipped to 0.38, also a three-and-a-half year low. The drug industry I/S held steady at a low 1.05 while apparel's I/S ratio of 1.99 was the lowest since April 2015.
The wholesale trade figures are available in Haver's USECON database. The expectations figure for inventories is contained in the MMSAMER database. Expectations for sales are from the AS1REPNA database.
Wholesale Sector - NAICS Classification (%) | Jun | May | Apr | Y/Y | 2017 | 2016 | 2015 |
---|---|---|---|---|---|---|---|
Inventories | 0.1 | 0.3 | 0.1 | 5.1 | 3.6 | 2.2 | 1.3 |
Sales | -0.1 | 2.1 | 1.4 | 10.2 | 7.4 | -1.3 | -4.9 |
I/S Ratio | 1.25 | 1.25 | 1.27 | 1.31 (Jun '17) | 1.30 | 1.35 | 1.33 |