U.S. wholesale inventories declined by more than expected in June, suggesting that growth could be slower than previous data indicated.
Inventories of merchant wholesalers fell 0.5 percent compared with the previous month, data from the Commerce Department showed Tuesday. This suggests that wholesalers are liquidating inventory as demand declines. The wholesale inventory estimate was revised down to show a decline in May from April.
Nondurable goods inventories dropped 1.2 percent, with stocks of petroleum, paper, and farm products all declining.
In the durable goods category, inventories slipped a milder 0.1 percent. Stocks of computer equipment, hardware, and metals fell. Auto and machinery inventories, however, rose.
Compared with a year ago, however, merchants seem a bit more optimistic. Total inventories were up 1.3 percent in June compared with the same month last year.
The ratio of inventories to sales climbed a bit, with wholesalers holding 1.4 months worth of merchandise compared with 1.40 months in May.
