U.S. Wholesale Inventories Increase in June

(Reuters) – U.S. wholesale inventories increased in June, contributing to economic growth in the second quarter.

The Commerce Department’s Census Bureau reported on Thursday that wholesale inventories rose by 0.2% in June, as previously estimated. Stocks at wholesalers also advanced by 0.5% in May.

Economists polled by Reuters had predicted that inventories—a key component of gross domestic product (GDP)—would rise by an unrevised 0.2%. Year-over-year, inventories increased by 0.1% in June.

The economy grew at a 2.8% pace in the second quarter, doubling the growth rate from the first quarter. Private inventory investment contributed 0.82 percentage points to GDP growth for the April-June period, offsetting a 0.72 percentage point decline due to a broader trade gap.

Wholesale motor vehicle inventories increased by 0.8% in June. Excluding automobiles, wholesale inventories went up by 0.1%, which is significant for GDP calculations.

However, sales at wholesalers fell by 0.6% in June after a 0.3% increase in May. At the current sales pace, it would take wholesalers 1.37 months to clear their shelves, slightly up from 1.35 months in May.