U.S. wholesale inventories increased more than expected initially in September, but automobile stocks declined further amid a global semiconductor shortage, which is undercutting motor vehicle production.
The Commerce Department said on Wednesday that wholesale inventories increased 1.4%, instead of 1.1% as estimated last month. Stocks at wholesalers rose 1.3% in August. Wholesale inventories jumped 13.1% in September from a year earlier.
Motor vehicle inventories declined 1.8% after falling 0.3% in August. Inventories are a key part of gross domestic product. Wholesale inventories, excluding autos, shot up 1.7% in September. This component goes into the calculation of GDP.
The current supply-chain disruptions are making it difficult for businesses to manage their inventories, therefore, it’s possible that businesses are caught with excess inventories in a couple of years as they over-order today to compensate for the delays.
Tags Commerce Department GDP US Economy Wholesale Inventories
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