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- US: Wholesale Trade (Jan)
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Economy in Brief
U.S. Consumer Credit Outstanding Declines in January
Consumers reduced credit balances further in January...
U.S. Trade Deficit Widens to $68.2 Billion in January
The U.S. trade deficit in goods and services widened to $68.2 billion in January...
German Order Growth Gets Back in Gear Despite the Headwinds
German order growth is back in gear with total orders rising by 1.4% m/m in January...
U.S. Factory Orders & Shipments Rise Again in January
Manufacturing activity is strengthening. Factory orders rose 2.6% (2.8% y/y) in January...
U.S. Initial Unemployment Insurance Claims Rise Just 9,000
Initial claims for unemployment insurance rose modestly by 9,000 to 745,000 in the week ended February 27...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Gerald D. Cohen June 7, 2019
Wholesale inventories increased 0.8% in April (7.6% year-over-year), following no change in March (revised up from a 0.1% decline). The Informa Global Markets Survey anticipated a 0.7% rise. Wholesale inventory swings can have a meaningful impact on GDP. In the first quarter, inventories provided a 0.6 percentage point boost to GDP growth.
Durable goods inventories increased 1.0% (11.0% y/y) in April after a 0.3% rise in March. Machinery inventories, the largest sector, grew 0.6% (14.2% y/y), while vehicles, the second largest, advanced 3.8% (13.1% y/y). Electrical equipment was up 0.4% (9.6% y/y). Inventories of nondurable goods gained 0.5% (2.5% y/y) after declining 0.6% in March. Drug inventories, which make up a quarter of nondurable inventories, rose 1.5% (7.0% y/y). Groceries, the second largest category, gained 0.9% (2.0% y/y).
Wholesale sales declined 0.4% during April (+2.7% y/y) following a 1.8% gain. The Action Economics Forecast Survey looked for an unchanged reading.
Durable goods sales fell 1.1% (+1.6% y/y) after a 0.6% increase. Electrical equipment, the largest sector, dropped 3.2% (-0.2% y/y). Professional and commercial equipment, which includes computers, declined 1.8% (+2.4% y/y). These decreases were somewhat offset by 0.5% growth in wholesale vehicle sales (3.1% y/y). Nondurable product sales rose 0.2% (3.8% y/y) after a 3.0% gain. Petroleum products edged down 0.1% (8.0% y/y) after jumping 8.5% in March. This is likely the result of the leveling off of oil prices in the early spring after a substantial increase in the first quarter. Drug sales, which vie with petroleum to be the largest category of nondurable sales, were unchanged (+4.6% y/y) while groceries gained 0.9% (4.9% y/y).
The inventory-to-sales (I/S) ratio at the wholesale level edged up to 1.34. I/S ratio has been range-bound during 2019 after rising during the second half of last year, The Durable goods I/S ratio increased to 1.75, the highest level since the end of the Great Recession. The machinery ratio declined to 2.69, while motor vehicles rose to 1.80, a ten year high. The I/S ratio for nondurable goods increased to 0.97. The petroleum industry I/S ratio edged up to 0.34 from March’s four-and-a-half year low of 0.34. The drug industry I/S rose to 1.10.
The wholesale trade figures and oil prices are available in Haver's USECON database. The expectations figure for inventories is contained in the MMSAMER database. Expectations for sales are in the AS1REPNA database.
Wholesale Sector - NAICS Classification (%) | Apr | Mar | Feb | Apr Y/Y | 2018 | 2017 | 2016 |
---|---|---|---|---|---|---|---|
Inventories | 0.8 | 0.0 | 0.4 | 7.6 | 7.1 | 3.3 | 1.9 |
Sales | -0.4 | 1.8 | 0.3 | 2.7 | 6.5 | 6.7 | -1.3 |
I/S Ratio | 1.34 | 1.33 | 1.35 | 1.28 (Apr '18) | 1.29 | 1.30 | 1.35 |