MNI DATA ANALYSIS: US Wholesale Inventories Up 0.6% In May>

--May Wholesale Sales +2.5%; Inv/Sales Ratio 1.24 Vs 1.27 In April

--May Business Inv Tracking +0.4%, Business Sales +1.3%

By Kevin Kastner, Harrison Clarke, and Shikha Dave

     WASHINGTON (MNI) - May wholesale inventories increased by 0.6%, 

revised upward from the 0.5% gain reported in the advance estimate, 

while wholesale sales increased 2.5% in the month, data released by the 

U.S. Commerce Department on Wednesday showed. 

     Given that wholesale inventories rose 0.6% and factory inventories 

were already reported up 0.2%, and barring no revision to the 0.4% rise 

in retail inventories, an MNI calculation is expecting an increase of 

0.4% for business inventories, which will be released on July 16.  

     With the addition of the 2.5% gain in wholesale sales to the 0.8% 

increase for retail trade sales from last month's advanced sales release 

and the 0.6% gain for factory shipments already reported, an MNI 

calculation predicts that business sales will see a 1.3% rise, barring 

no large revision to retail trade sales data. 

--Y/Y SALES SURGE

     Since wholesale inventories posted a much more modest gain than did 

sales, the inventory/sales ratio fell to 1.24. Inventories were up 5.9% 

year/year, while sales have risen 11.8% from May 2017. The ratio is down 

from the 1.31 ratio seen one year ago due to sales growth outpacing 

inventories over the past year. 

     When excluding the 1.2% decline in auto inventories, inventories 

would have been up 0.8%, according to an MNI calculation. Excluding a 

2.9% increase in auto sales, sales would have been up 2.5%, also 

according to an MNI calculation. 

     The value of durable inventories rose by 0.5% in the month, led by 

gains in every category except autos. Nondurables inventories rose 0.7% 

in May on drugs and petroleum. 

     Durables goods sales were up 1.9% in the month, with the categories 

generally higher. Nondurable goods sales rose by 3.1% in May on an 8.3% 

rise in petroleum. 

     ** MNI Washington Bureau: 202-371-2121 ** 

[TOPICS: MAUDS$,M$U$$$]