September 8, 2017 / 2:15 PM / 2 months ago

U.S. wholesale inventories revised higher in July

WASHINGTON (Reuters) - U.S. wholesale inventories rose 0.6 percent in July as stocks for a variety of goods, including autos, posted gains.

New cars are shown for sale at a dealership in National City, California, U.S., June 30, 2017. REUTERS/Mike Blake

The Commerce Department said on Friday that wholesale inventories rose 0.6 percent, matching the rise in each of the previous two months. The department last month reported that wholesale inventories rose 0.4 percent in July.

Auto inventories increased 0.2 percent in July after jumping 1.1 percent in June. Slowing demand for autos has left manufacturers with an inventory glut, but economists say demand is likely to increase as drivers in Texas and other states ravaged by hurricanes replace storm-damaged vehicles.

The component of wholesale inventories that goes into the calculation of gross domestic product - wholesale inventories excluding autos - rose 0.7 percent in July.

A shopping cart is seen inside a Costco Wholesale warehouse club in Westbury, New York, U.S., May 23, 2016. REUTERS/Shannon Stapleton

Durable goods inventories rose 0.9 percent, helped by a 1.1 percent increase in stocks of machinery, the biggest rise in nearly three-and-a-half years. Inventories of electrical equipment rose 2.6 percent.

Inventory investment had a neutral impact on the second quarter’s 3.0 percent annualized GDP growth rate after subtracting 1.46 percentage points from growth at the start of the year.

Sales at wholesalers slipped 0.1 percent after rising by a revised 0.6 percent in June. Economists had expected sales to rise 0.4 percent in July.

Motor vehicles sales slid 0.8 percent in July after rising 0.2 percent in June.

At July’s sales pace, it would take 1.30 months to clear shelves, which was the highest since November 2016. That compared with 1.29 months in June. The inventories-to-sales ratio for motor vehicles rose to 1.80 months from 1.78 in June. That ratio has increased from 1.67 months in January.

Reporting by Andrea Ricci; Editing by Paul Simao

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