| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Month over Month | 0.1% | 0.0% to 0.2% | 0.2% | -0.2% |
Highlights
Wholesale inventories rose 0.2 percent in the second estimate for October from September, unrevised from the first estimate, and following an unrevised decline of 0.2 percent in September. Forecasters expected a slight downward revision to 0.1 percent for October.
Wholesale inventories rose 0.9 percent from a year ago. The wholesale inventory-sales ratio was at 1.34 in October versus 1.34 in September and 1.34 in October a year ago.
October details, month on month, show a 0.1 percent increase for durable goods, led by a 2.9 percent increase in computer equipment, a 2.7 percent rise for furniture, and a 2.6 percent gain in professional equipment, offset by 0.1 percent decline in autos and a 1.0 percent decrease in electrical equipment. There was a 0.3 percent rise for nondurable goods, led by groceries, up 1.6 percent, and drugs, up 1.1 percent, offset by petroleum, down 2.5 percent, and farm products, down 2.0 percent.
Wholesale inventories rose 0.9 percent from a year ago. The wholesale inventory-sales ratio was at 1.34 in October versus 1.34 in September and 1.34 in October a year ago.
October details, month on month, show a 0.1 percent increase for durable goods, led by a 2.9 percent increase in computer equipment, a 2.7 percent rise for furniture, and a 2.6 percent gain in professional equipment, offset by 0.1 percent decline in autos and a 1.0 percent decrease in electrical equipment. There was a 0.3 percent rise for nondurable goods, led by groceries, up 1.6 percent, and drugs, up 1.1 percent, offset by petroleum, down 2.5 percent, and farm products, down 2.0 percent.
Market Consensus Before Announcement
The consensus looks for a slight revision to 0.1 percent from 0.2 percent in the flash.
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.
