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Saturday, September 21, 2019 9:24:58 PM EDT

Wholesale Inventories Updated 11-Sep-19 10:21AM ET

Wholesale inventories increased 0.2% m/m in July, as expected, on top of a downwardly revised 0.1% decline (from 0.0%) for June.

Wholesale sales increased 0.3% in July after declining an unrevised 0.3% in June.

On a year-over-year basis, total sales were unchanged while total inventories were up 7.1%.

Durable inventories decreased 0.2% in July, driven by a decline in inventories for metals (-1.9%), electrical (-1.5%), hardware (-0.5%), and machinery (-0.2%).

Nondurable inventories increased 0.8% in July, driven by increases in all categories with the exception of apparel (-0.3%) and chemicals (-1.6%).

The inventories-to-sales ratio held steady month-over-month at 1.36, but was up from 1.27 a year ago.

The key takeaway from the report is that it could prove difficult for wholesalers to gain pricing power given that inventory growth remains well ahead of sales growth on a yr/yr basis.