Wholesaler Sales Rise Most in 18 Months, Inventories Rise Less Than Expected

- Wholesale Inventories for March rose .3% versus estimates of a .4% gain and a downwardly revised .4% increase in February.

BOTTOM LINE: Sales at US wholesalers rose at the fastest pace in 18 months in March, outstripping an increase in inventories and pointing to a pick-up in production, Bloomberg said. The increase reflected rising demand for computer equipment and durable goods. Sales of durable goods at wholesalers jumped 2.1% versus a .8% decline in February. It also implies that companies have successfully trimmed inventories down to manageable levels. Goods on hand represented 1.14 months’ supply at the current sales pace, the lowest this year. This corresponds with the recent ISM Manufacturing report that manufacturing grew at the fastest pace in almost a year. I continue to believe the worst of the inventory de-stocking is over and that inventory rebuilding will begin adding to economic growth this quarter.