WASHINGTON - The value of wholesale inventories fell 0.5% in October, revised down from the 0.4% decline in the advance estimate, while wholesale sales saw a 0.7% increase, data released Friday by the U.S. Commerce Department showed.
With the addition of the 0.5% decline in wholesale inventories reported Friday, an MNI calculation expects a 0.1% negative reading for business inventories when it is released, assuming no revision to the 0.1% decline reported for retail inventories in the advance estimate. Factory inventories saw a 0.2% gain for October, the report stated on Monday.
The 0.7% increase for wholesale sales released Friday, comes in addition to a 0.2% increase for retail trade sales from last month's advanced sales release and the 0.6% increase for factory shipments reported on December 4, adding up to a 0.5% increase for business sales barring a large revision to retail trade sales.
With the decline in October wholesale inventories and the larger increase in wholesale sales, the inventory/sales ratio fell to 1.25 from 1.26 in September, hitting its lowest since December 2014 (1.25). The ratio was below the 1.30 mark in October 2016, as sales have increased faster than inventories over the last year.
Excluding the auto category, wholesale inventories would have been down 0.5% in October after a 0.2% increase in the previous month, an MNI calculation showed. Sales would have been up 0.5% in October if auto sales were excluded. This followed a 1.5% gain in September, with the year-over-year seeing a 7.8% increase.
The value of durable inventories rose by 0.1% in the month, though auto inventories fell by 0.7%. The remaining durables components were mixed, with gains in lumber, metals, hardware, and machinery. Aside from autos, the biggest loss was in electrical(-0.6%).
Nondurables inventories were down 1.3% in October. The biggest declines were seen in drugs (-2.5%), farm products (-3.7%), and miscellaneous nondurables (-2.7%). The remaining categores mainly saw decreases, with only apparel, chemicals, and petroleum seeing gains.
Durables goods sales were up 1.3% in the month, with auto sales up 3.4%. The remaining components saw declines in professional equipment, computer equipment, metals, and electrical, though not enough to offset the strong gains in other categories.
Nondurable goods sales were up 0.2% in October after a 2.0% gain in September. Petroleum sales posted the only decline of 5.9%, this follows a 12.7% increase in September, but still up 16.7% year-over-year.
