U.S. Wholesale Inventories Continue to Rise in September
by:Tom Moeller
|in:Economy in Brief
Summary
- Increase moderates after August surge.
- Sales rebound modestly.
- Inventory-to-sales ratio holds steady.
Wholesale inventories rose 0.6% (24.1% y/y) during September following a 1.4% August increase, revised from 1.3%. The latest gain compared to a 0.9% rise in the advance report issued earlier. Monthly increases have slowed significantly since early this year. The Informa Global Markets Survey expected a 0.8% rise in September.
Durable goods inventories rose 0.8% (26.5% y/y) in September following a 1.5% gain in August. Motor vehicle & parts inventories rose 1.8% (36.8% y/y). Furniture & home furnishings inventories rose 0.6% (42.4% y/y) while professional equipment inventories rose 0.9% (18.5% y/y). Electrical equipment inventories increased 0.3% (33.0% y/y), while machinery inventories gained 2.2% (22.9% y/y). Inventories of metals & minerals excluding petroleum declined 1.0% in September (+19.0% y/y).
In the nondurable goods sector, inventories edged 0.1% higher (20.6% y/y) in September after strengthening 1.2% in August. Petroleum & petroleum product inventories fell 3.8% (+18.1% y/y) with lower prices. Chemical inventories fell 2.6% (+24.9% y/y). On the other hand, apparel inventories rose 3.4% (69.1% y/y). and grocery product inventories rose 1.7% (23.0% y/y).
Wholesale sales rose 0.4% (14.4% y/y) in September after little change in August. The Action Economics Forecast Survey expected a 0.5% rise. Durable goods sales rose 0.7% (10.9% y/y) after easing 0.1% in August. Motor vehicle & parts sales rose 5.9% (20.3% y/y). Sales of machinery rose 0.8% (14.9% y/y) while electrical machinery sales in September rose 1.6% (13.9% y/y). Professional equipment sales rose 1.7% (4.6% y/y), but furniture & home furnishings sales fell 1.4% (+10.7% y/y).
Sales of nondurable goods edged 0.1% higher (17.6% y/y) in September, the same as in August. A 0.6% decline (+30.9% y/y) in petroleum sales held back the total change. Apparel sales also weakened 2.0% (+6.4% y/y) and paper & product sales fell 0.6% (+14.2% y/y). In contrast, chemical sales rose 0.4% (18.9% y/y) and grocery sales improved 0.7% (10.9% y/y) in September.
The inventory-to-sales (I/S) ratio held steady at 1.31 in September and remained up from 1.29 in July. It was the highest ratio since November 2020. The durable goods I/S ratio remained at 1.72 in September and compared to a low of 1.48 in July 2021. The I/S ratio for nondurable goods also was steady at 0.96 and remained at the highest level since June of last year.
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 in the AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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