WASHINGTON, Oct 8 (Businesshala) – U.S. wholesale inventories rose in August amid declining sales, though automobile stocks remained very low due to global chip shortages, which are hampering automotive production.
The Commerce Department said on Friday that wholesale goods grew 1.2 per cent over last month’s estimate. Wholesalers’ shares rose 0.6% in July. Wholesale inventory grew 12.3 per cent in August from a year ago.
Automotive inventories fell 0.1% after falling 0.3% in July. Inventories are a significant part of GDP. Wholesale inventory excluding auto grew 1.3% in August. This component goes into the calculation of GDP.
Trade inventories were exhausted in the first half of the year, but stocks are finding it difficult to rebuild stocks amid persistent supply constraints caused by the COVID-19 pandemic and port congestion in the United States and China.
Inventory rebuilding is expected to dampen manufacturing and economic growth in the second half of the year.
Wholesalers’ sales fell 1.1% in August after rising 2.1% in July. At August’s sales pace, it would take 1.23 months for wholesalers to clear shelves, up from 1.20 months in July. (Reporting by Lucia Muticani Editing by Paul Simao)