U.S. Wholesale Inventories Are Little Changed in March
by:Tom Moeller
|in:Economy in Brief
Summary
- Durable goods inventories hold steady, while nondurables ease.
- Sales move broadly lower.
- Inventory-to-sales ratio climbs to three-year high.
Wholesale inventories were flat (+9.1% y/y) in March for the second month in a row. This was little revised from the advance report issued earlier. Inventory growth has slowed considerably since early-2022. A 0.1% rise had been expected in the Informa Global Markets Survey.
Durable goods inventories held steady (+13.0% y/y) in March after rising 0.5% in February. Motor vehicle & parts inventories rose 1.5% (24.0% y/y). Furniture & home furnishings inventories declined 1.4% (+2.1%), the fourth consecutive sharp monthly decline. Professional equipment inventories eased 0.1% (+1.6% y/y), down for the fourth month in the last five while electrical equipment inventories weakened 0.9% (+16.6% y/y). Machinery inventories gained 1.1% (27.7% y/y).
In the nondurable goods sector, inventories declined 0.2% (+3.5% y/y) in March, the fourth consecutive monthly drop. Petroleum & petroleum product inventories fell 3.6% (-5.0% y/y), also the fourth straight monthly drop. Chemical inventories fell 0.5% (+1.4% y/y), the seventh consecutive monthly decline. Apparel inventories fell 0.4% (+17.9% y/y) and grocery product inventories fell 0.3% (+4.0% y/y).
Wholesale sales declined 2.1% (-2.9% y/y) in March after rising 0.4% in February. The Action Economics Forecast Survey expected a 0.4% monthly gain.
Durable goods sales fell 2.3% (-2.9% y/y) after rising 1.5% in February. Motor vehicle & parts sales weakened 0.9% (+9.3% y/y). Sales of machinery were off 2.7% (+12.5% y/y) while electrical machinery sales fell 3.8% (-2.1% y/y). Professional equipment sales eased 0.6% (-7.8% y/y) and furniture & home furnishings sales edged 0.1% higher (-0.9% y/y). Metals & mineral sales declined 1.5% (-14.1% y/y).
Sales of nondurable goods tumbled 1.9% (-3.0% y/y) in March, adding to a 0.6% February shortfall. A 4.2% drop (-18.4% y/y) in petroleum sales, the fifth consecutive monthly decline, was accompanied by a 0.4% easing (-5.7% y/y) in chemical product sales. Apparel sales fell 0.7% (-9.4% y/y) and paper product sales declined 3.1% (-4.0% y/y). Grocery product sales fell 0.9% (+4.9% y/y).
The wholesale inventory-to-sales (I/S) ratio jumped to 1.40 in March from 1.37 in February and was the highest ratio since June 2020. The I/S ratio in the durable goods sector rose to 1.83 and compared to a low of 1.47 in June 2021. The I/S ratio for nondurable goods edged higher to 1.03 and was the highest since November 2020.
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.
More Economy in Brief
