BLBG: Inventories at U.S. Wholesalers Unexpectedly Fall (Update1)
By Courtney Schlisserman
Feb. 9 (Bloomberg) -- Inventories at U.S. wholesalers unexpectedly fell in December after the biggest increase in more than five years, indicating distributors had trouble keeping up with demand.
The 0.8 percent decrease in stockpiles followed a revised 1.6 percent gain in November that was the largest since July 2004, figures from the Commerce Department showed today in Washington. Sales climbed 0.8 percent.
A record inventory drawdown last year has opened the door for manufacturers to pick up production and other companies to increase orders to meet demand. Efforts to prevent stockpiles from falling further in the fourth-quarter provided its biggest boost to economic growth in 20 years and may keep supporting the economy in coming quarters.
“Sales growth is strong and every company is in restocking mode,” Ken Mayland, president of ClearView Economics LLC in Pepper Pike, Ohio, said before the report. “They need a significant rebuild. It’s going to last the next couple of quarters.”
Economists forecast inventories would rise 0.5 percent after a previously estimated 1.5 percent increase in November, according to the median of 31 projections in a Bloomberg News survey. Estimates ranged from a drop of 0.8 percent to a 1 percent gain.
To contact the reporter on this story: Courtney Schlisserman in Washington at cschlisserma@bloomberg.net