Wholesale inventories in the U.S. declined for the second consecutive month in April, the Commerce Department said Thursday.
Inventories at U.S. wholesalers ticked down 0.1 percent in April compared with the prior month. March inventories were revised down to show a decline of 0.2 percent from the preliminary report showing inventories were flat for the month after rising a bit in February.
Economists had expected inventories to decline 0.2 percent in April, so the report was stronger than expected. But with the revision to the prior month, inventories sit around where analysts had forecast.
After soaring from the summer of 2020 through the end of 2022, inventories have leveled off this year as many wholesalers anticipate a recession and rising interest rates have increased borrowing costs, including the cost of credit wholesalers use to accumulate inventories.
Inventories of durable goods jumped 0.6 percent in April, boosted by gains in machinery, metals, and autos. Inventories of lumber declined by 1.5 percent, perhaps because building has been recovering faster than expected. Inventories of computer equipment also fell.
Nondurable goods inventories fell by 1.2 percent. The decline was driven by a fall in inventories of farm products, paper, and apparel. Petroleum and grocery inventories, however, rose.
Despite the recent declines, inventories are up significantly from a year ago. The Commerce Department said inventories are up 6.3 compared with April of 2022.
The ratio of inventories to sales, which is based how many months it would take for wholesalers to sell down their inventories at the current sales rate, was 1.4 percent, a relatively high level compared with the prepandemic era and down one-tenth of a point from the prior month.
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