Showing all posts tagged #wholesale:


US wholesale inventories led growth to be revised down by about one tenth in Q3 and Q4

Posted on December 10th, 2015


Main takeaways:
  • Lower than anticipated wholesale inventories in October and downward revisions to the previous month led analysts to adjust GDP growth estimates slightly down in Q3 and Q4 by about one tenth. GDP growth tracking for Q4 is in the 1.5% to 2.0% range.
  • Wholesale sales are moving sideways (current prices) after a sharp drop earlier this year.
  • However, adjusting for prices, wholesale sales are now back to trend.
  • Inventory buildup is mostly due to petroleum.


The chart below shows that retail, wholesale and manufacturing sales, all slowed down materially since mid-2014.
Retail sales excluding gasoline is still growing at a reasonable pace (see US Retail Sales -- trend remains unchanged Oct/2015)
So, let's take a closer look at wholesale sales.


Part of the slowdown in wholesale sales is clearly due to price effect. Adjusting for falling prices, wholesale sales were roughly flat from late 2014 to mid 2015 and now appears to be back to the trend observed since 2009.

Another frequent concern is the inventory buildup at wholesalers. The chart below show that the inventory to sales ratio has increased sharply in the last three quarters.

But a similar price effect might be distorting oil inventories. Excluding autos, farm, and petroleum, the rise in the inventory-to-sales is less pronounced.


US Wholesale Trade Sales and Inventories (Jul/2015)

Posted on September 10th, 2015


Main takeaways:
  • Wholesale sales are moving sideways (adjusted for prices)
  • Inventory buildup is mostly due to petroleum; nevertheless an inventory correction is widely expected for the third quarter.
  • Analysts reduced 3Q growth forecasts by 0.1 to 0.3pp accounting for lower inventories.



The chart below shows that retail, wholesale and manufacturing sales, all slowed down materially since mid-2014.
Retail sales have already rebounded and it is clear that most of its slowdown was related to the fall in gasoline prices (see US July/15 Retail Sales -- good).
So, let's take a closer look at wholesale sales.


Part of the slowdown in wholesale sales is clearly due to price effect. Adjusting for falling prices, wholesale sales appear to have stabilized in the last couple of quarters.

Another frequent concern is the inventory buildup at wholesalers. The chart below show that the inventory to sales ratio has increased sharply in the last three quarters.

But a similar price effect might be distorting oil inventories. Excluding autos, farm, and petroleum, the rise in the inventory-to-sales is less pronounced.




Details: charts below break wholesale data into nondurable and durable sectors.

Nondurable






Durable









Total wholesale





Paulo Gustavo Grahl, CFA

Random comments on macro data. Views are my own. Except when they aren't.