Amid many signs that the U.S. economy may not have contracted as much as expected given the fevered rate of Fed rate hikes, U.S. wholesale inventories continued to expand in July but at a slower pace. That could indicate cooling.
Amid many signs that the U.S. economy may not have contracted as much as expected given the fevered rate of Fed rate hikes, U.S. wholesale inventories continued to expand in July but at a slower pace.
Inventories of U.S. merchant wholesalers rose 0.6 percent in July on month, the Commerce Department said Wednesday. That was below the preliminary estimate for an increase of 0.8 percent. Wall Street had expected inventories to grow at the pace reported in the preliminary report. Despite the slowdown in the pace of inventory building by wholesalers, total inventories have continued to expand. Total inventories were up 25.1 percent from the revised July 2021 level.
The two quarterly contractions in the first half of this year were in part caused by slowing inventory growth. In the first quarter, inventories subtracted 0.8 percent and in the second quarter inventories subtracted 1.83 percentage points from GDP. Strong consumer spending, however, kept GDP from falling by all that much. In the second quarter, it fell by just 0.6 percent.