U.S. Wholesale Inventories Drop More Than Expected In February

(RTTNews) - Reflecting a sharp pullback in inventories of non-durable goods, the Commerce Department released a report on Friday showing a bigger than expected decrease in U.S. wholesale inventories in the month of February.

The Commerce Department said wholesale inventories fell by 0.5 percent in February after edging down by a revised 0.2 percent in January.

Economists had expected inventories to dip by 0.2 percent compared to the 0.3 percent increase originally reported for the previous month.

The bigger than expected decrease came as inventories of non-durable goods tumbled by 1.1 percent in February after climbing by 0.7 percent in January.

Inventories of farm product raw materials and drugs and druggists' sundries showed substantial decreases during the month.

Meanwhile, the report said inventories of durable goods edged down by 0.1 percent in February following a 0.7 percent decrease in January.

A sharp drop in inventories of lumber and other construction materials was partly offset by a notable increase in inventories of electrical and electronic goods.

The Commerce Department also said wholesale sales slipped by 0.2 percent in February after plunging by 1.9 percent in the previous month.

Sales of non-durable goods slumped by 1.6 percent amid a steep drop in sales of petroleum and petroleum products.

On the other hand, the report said sales of durable goods jumped by 1.2 percent amid sharp increases in sales of electrical and electronic goods and lumber and other construction materials.

The inventories/sales ratio for merchant wholesalers came in at 1.36 in February, down from 1.37 in January but up from 1.31 in the same month last year.

Compared to the same month a year ago, wholesale inventories were up by 0.6 percent in February, while wholesale sales were down by 3.1 percent.