| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Month over Month | -0.1% | -0.1% to -0.1% | -0.2% | -0.5% | -0.7% |
Highlights
Wholesale inventories fell 0.2 percent in the second estimate for July, versus a 0.1 percent draw in the first estimate and a downward revised 0.7 percent draw for June. July details include a 0.3 percent draw for durables offset only in part by a 0.1 percent build for nondurables. Year-over-year, wholesale inventories were up 0.5 percent in total split between a 5.1 percent build for durables and a 6.4 percent draw for nondurables.
Sales data for the wholesale sector show a 0.8 percent rise in July that reversed a 0.8 percent decline in June. Durable sales rose 0.3 percent in the month with nondurables up 1.3 percent. Year-over-year, wholesale sales were down 4.2 percent split between 2.3 percent contraction for durables and 5.8 percent contraction for nondurables.
Sales data for the wholesale sector show a 0.8 percent rise in July that reversed a 0.8 percent decline in June. Durable sales rose 0.3 percent in the month with nondurables up 1.3 percent. Year-over-year, wholesale sales were down 4.2 percent split between 2.3 percent contraction for durables and 5.8 percent contraction for nondurables.
Market Consensus Before Announcement
The second estimate for July wholesale inventories is expected to fall 0.1 percent, unchanged from the first estimate.
Definition
Wholesale trade measures the dollar value of sales made and inventories held by merchant wholesalers. It is a component of business sales and inventories.
Description
Investors need to monitor the economy closely because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers a slower rate of growth that won't lead to inflationary pressures. Wholesale sales and inventory data give investors a chance to look below the surface of the visible consumer economy. Activity at the wholesale level can be a precursor for consumer trends. In particular, by looking at the ratio of inventories to sales, investors can see how fast production will grow in coming months. For example, if inventory growth lags sales growth, then manufacturers will need to boost production lest product shortages occur. On the other hand, if unintended inventory accumulation occurs (i.e. sales did not meet expectations), then production will probably have to slow while those inventories are worked down. In this manner, the inventory data provide a valuable forward-looking tool for tracking the economy.
