Last Update: 17-Apr-14 18:15 ET
- Wholesale inventories increased 0.5% in February after increasing an upwardly revised 0.8% (from 0.6%) in January. The Briefing.com consensus expected wholesale inventories to increase 0.5%.
- There were concerns that strong inventory growth in February would be the result of severe winter weather conditions. In theory, the extreme cold would keep shoppers away, which would result in more goods being left on the shelves. That notion has been debunked in just about all of the economic data over the last several weeks, including the February wholesale inventory data. Sales, which should have weakened from weather effects, increased 0.7% in February after falling 1.8% in January.
- Durable inventories increased a solid 0.7% in February after increasing 0.8% in January. Most of the gain was the result of a 1.4% increase in machinery inventories.
- Nondurable inventories increased 0.1%, down from a 0.8% increase in January. A 2.7% increase in farm product inventories was offset by a 2.6% decline in petroleum.
- The inventory-to-sales ratio remained at 1.19.
- Wholesale inventories are just one component of total business inventories. Manufacturing and retail inventories make up the rest of total business inventories. The market ignores this release and doesn't pay much attention to the full business inventory release that comes a few days later. Improved inventory management in recent years has reduced the economic swings associated with inventories and has helped produce a long-term downtrend in the inventory-to-sales ratio.