U.S. Wholesale Inventories & Sales Decline in March
by:Tom Moeller
|in:Economy in Brief
Summary
- Wholesale inventories reverse February increase.
- Sales decline also follows earlier strength.
- The I/S ratio increases slightly m/m after trending lower.
Wholesale inventories fell 0.4% (-2.3% y/y) during March after increasing 0.2% in February, revised from 0.5%. The 0.2% January decline was unrevised and growth has moderated substantially since 2022. The latest decline matched expectations in the Informa Global Markets Survey.
In March, durable goods inventories eased 0.1 % (+2.1% y/y) after rising 0.7% in February. The value of metals inventories declined 1.6% (-8.4% y/y) while motor vehicles & parts inventories eased 0.1% (+9.5% y/y). Professional & commercial equipment inventories fell 0.2% (-0.3% y/y) including a 2.4% gain (3.4% y/y) in inventories of computer equipment. Electrical & electronic goods edged 0.1% lower (-6.0% y/y) but furniture inventories rose 1.0% (-8.1% y/y). Inventories of lumber & other construction materials rose 0.8% (0.3% y/y).
Nondurable wholesale goods inventories weakened 1.1% (-9.1% y/y) in March after a 0.5% February decline. Farm product inventories dropped 2.3% (-30.7% y/y) while grocery product inventories weakened 1.0% (5.8% y/y). Paper & product inventories fell 0.9% (-14.6% y/y). Working higher, inventories of petroleum & products rose 1.2% (-15.2% y/y) while chemicals & products inventories increased 0.5% (-9.9% y/y).
Wholesale sales of merchandise declined 1.3% (+1.4% y/y) in March after rising 2.0% in in February. A 1.0% rise had been expected in the Action Economics Forecast Survey.
Durable goods sales fell 1.0% in March (+1.4% y/y) after a 1.4% February rise. Metals & minerals sales dropped 4.4% (-12.6% y/y) and motor vehicle & parts sales decreased 1.9% (+6.8% y/y). Furniture sales declined 1.6% (-5.1% y/y) and machinery sales weakened 0.4% (-0.6% y/y). Electrical equipment sales weakened 0.7% (+3.9% y/y). To the upside, professional equipment sales increased 0.2% (1.9% y/y) with a 1.0% rise (-1.1% y/y) in computers. Hardware sales increased 0.6% (3.1% y/y).
Among nondurable goods wholesalers, sales fell 1.6% in March (+1.5% y/y) after rising 2.5% in February. Farm product sale were off 10.3% (-12.8% y/y. Petroleum sales weakened 5.6% (+0.5% y/y). Paper & product sales declined 0.5% (-4.1% y/y) and apparel sales fell 0.9% (-3.6% y/y). Chemical sales rose 2.6% (1.3% y/y) while grocery purchases improved 0.2% (1.3% y/y).
The wholesale inventory/sales ratio (I/S) edged up to 1.35 in March from 1.34 in February. For durable goods, the I/S ratio of 1.82 in March was increased from 1.80 in February. The nondurable goods I/S ratio was stable m/m at 0.93.
The wholesale trade figures are compiled by the U.S. Census Bureau and are available in Haver’s USECON database. The expectations figure for total inventories is contained in the MMSAMER database, and the sales expectations figure is 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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