Wholesale Trade Gets a Boost From Booze for July


Wholesale trade oozed up slightly for July, according to a Commerce Department report (link opens a PDF) released today.

After increasing a seasonally adjusted 0.4% from May to June, wholesales sales increased just 0.1% for July to $426 billion. Compared with July 2012, sales are up 5.7%.

While wholesale trade is used as an indicator of economic strength, investors pay close attention to durable goods as a potential sign of more sustainable confidence (or lack of confidence). For July, durable goods sales lost almost all of June's seasonally adjusted 0.8% gains with a 0.6% month-over-month slump. Auto sales led the decline, down 3.1% for July.

Nondurable goods sales helped offset negative numbers, up a seasonally adjusted 0.7% primarily because of a 2.1% rise in alcohol sales, a 1.9% increase in petroleum sales, and a 1.2% bump in farm products sales.

Investors also keep a close eye for any inventories buildups, considered to be one of the first major signs of a slowing economy. For July, overall inventories matched sales with a seasonally adjusted 0.1% increase of their own, clocking in lower than analysts' 0.3% expectations.

To understand the rate at which goods are being made and sold, economists compute an inventories/sales ratio. Since both sales and inventories rose almost the same amount, the inventories/sales ratio remained steady at 1.17, down from 1.21 in July 2012.

Source: Census.gov.

The article Wholesale Trade Gets a Boost From Booze for July originally appeared on Fool.com.

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