Wholesale Inventories Show Unexpected Decrease In December
2/9/2010 10:58 AM ET
(RTTNews) -
While the Commerce Department released a report Tuesday morning showing an unexpected decrease in wholesale inventories in the month of December, the report also showed a continued increase in wholesale sales during the month.
The report showed that wholesale inventories fell by 0.8 percent in December following an upwardly revised 1.6 percent increase in November. Economists had been expecting inventories to increase by 0.5 percent compared to the 1.5 percent increase originally reported for the previous month.
A notable drop in wholesale inventories of durable goods contributed to the unexpected decrease, with durable goods inventories falling by 1.1 percent in December. Wholesale inventories of non-durable goods also fell by 0.3 percent.
Peter Boockvar, equity strategist for Miller Tabak, said, "The very lean inventory situation on the wholesale side is evidence that without confidence in an increase in final demand, businesses will still be reluctant to restock the shelves."
"On the flip side, any sustained pick up in demand, could lead to a sharp increase in production," he added.
Meanwhile, the Commerce Department also said that wholesale sales increased by 0.8 percent in December after surging up by 3.6 percent in the previous month. The increase reflected a 3.0 percent jump in sales of durable goods.
With inventories falling and sales rising, the wholesale inventories/sales ratio fell to 1.12 in December from 1.14 in November and 1.32 in the same month a year ago. The decrease dragged the ratio down to its lowest level since June of 2008 and just shy of the record low of 1.11.
by RTT Staff Writer
For comments and feedback: contact editorial@rttnews.com
|
|