(Reuters) – U.S. wholesale inventories increased less than initially thought in July as businesses slowed the replenishment of their stocks.
The Commerce Department said on Friday that wholesale inventories rose 0.6%, instead of 0.8% as reported last month. Stocks at wholesalers advanced 1.8% in June.
Economists polled by Reuters had expected July inventories would be unrevised. Wholesale inventories increased 25.1% in July on a year-on-year basis.
Inventories are a key component of gross domestic product.
Wholesale motor vehicle inventories rose 1.7% after rising 3.0% in June. Wholesale inventories, excluding autos, increased 0.5% in July. This component goes into the calculation of GDP.
The U.S. economy unexpectedly contracted in the second quarter, at odds with a robust labor market. The decline largely reflected the hangover of excess inventory accumulation by businesses late last year, leaving stock to clear before more is ordered at a time when consumer spending has softened.
Sales at wholesalers fell 1.4% in July after increasing 1.6% in June. At July’s sales pace it would take wholesalers 1.29 months to clear shelves, up from 1.26 in June.
(Reporting by Lindsay Dunsmuir; Editing by Paul Simao)
