US wholesale inventories revised slightly up in April

US wholesale inventories increased slightly more than initially thought in April as growth in sales moderated, data showed on Wednesday.

The Commerce Department said that wholesale inventories advanced 2.2 per cent, instead of 2.1 per cent as reported last month. Data for March was revised higher to show stocks at wholesalers rising 2.7 per cent instead of the previously reported 2.3 per cent.

Economists polled by Reuters had expected April inventories would be unrevised. Wholesale inventories increased 24.0 per cent in April on a year-on-year basis. Inventories are a key part of gross domestic product.

Wholesale motor vehicle inventories rose 1.3 per cent after accelerating 2.4 per cent in March. Wholesale inventories, excluding autos, increased a solid 2.2 per cent in April. This component goes into the calculation of GDP and suggested that inventory investment could provide a lift to economic growth this quarter.

A record trade deficit and slower rate of inventory accumulation relative to the fourth quarter’s brisk pace weighed in output, resulting in GDP dropping at a 1.5 per cent annualised rate in the January-March quarter. Growth estimates for the second quarter are as high as a 4.8 per cent rate. Sales at wholesalers gained 0.7 per cent in April after increasing 1.8 per cent in March. At April’s sales pace it would take wholesalers 1.25 months to clear shelves, up from 1.23 months in March. REUTERS