WASHINGTON — The value of wholesale inventories rose 0.6% in July, an upward adjustment from the 0.4% gain estimated in the advance estimate, while wholesale sales fell 0.1%, data released Friday by the U.S. Commerce Department showed.
Looking ahead to business inventories report to be released on September 15, the tracking looks positive for both business inventories and business sales.
With the addition of the 0.6% gain for wholesale inventories reported Friday, an MNI calculation expects a 0.2% increase in business inventories when it is released, assuming no revision to the 0.2% decline reported for retail inventories in the advance estimate. Factory inventories were already reported up 0.2% for July.
The 0.1% decrease for wholesale sales reported Friday, partially offsets a 0.3% increase for factory shipments reported September 5 and a 0.6% jump for retail trade sales from last month's sales release, adding up to a 0.3% increase for business sales barring a large revision to retail trade sales.
With the sharp rise in July wholesale inventories and the small decline in wholesale sales, the inventory/sales ratio rose to 1.30 from 1.29 in June, hitting its highest point since November 2016. The ratio was still below the 1.33 mark in July 2016, as sales have increased faster than inventories over the last year.
Excluding the auto category, wholesale inventories would have been up 0.7% in July after a 0.5% increase in the previous month, an MNI calculation showed. Sales would have been flat in July if auto sales were excluded. This followed a 0.7% gain in June.
The value of durable inventories surged by 0.9% in the month, though auto inventories rose only 0.2%. The remaining durables components were all higher with the exception of furniture and computer equipment. The biggest gain was in electrical inventories, which rose by 2.6%
Nondurables inventories were up 0.2% in July. Petroleum inventories surged by 2.3%, while the other components were generally higher, particularly for farm products and miscellaneous nondurables.
Durables goods sales were down 0.1% in the month, with auto sales down 0.8%. The remaining components were mixed, with gains and declines roughly split.
Nondurable goods sales were flat in July after a 1.3% gain in June. Petroleum sales were up 1.1% after a 2.1% increase in June. The other component movements were split between gains and losses, though sales of drugs and groceries both declined.
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