Warehouse workers deal with inventory stacked up to the ceiling at the ABT Electronics Facility in Glenview.
WASHINGTON Reuters - U.S. wholesale inventories increased less than originally thought in October, suggesting businesses were carefully managing their stock amid slowing demand.
The Commerce Department said on Friday that wholesale inventories rose by 0.5% instead of 0.8% as reported last month. In September, the stock of wholesalers increased by 0.6%.
Economists polled by Reuters had predicted that inventories would be unrevised. On a year-on-year basis, wholesale inventories increased 21.9% in October.
Inventories are a key part of gross domestic product. There were decreases in furniture, computer and professional equipment stocks. In September, automotive inventories were unchanged, after rising by 1.4%.
Wholesale inventories, excluding autos, increased by 0.6% in October. This component is included in the calculation of GDP.
Inventories have been a drag on GDP for two straight quarters, and have lost a percentage point in the third quarter. The economy grew at a 2.9% annualized rate last quarter after contracting in the first half of the year.
Inventory accumulation has declined significantly from the robust pace in late 2021 and early 2022, due to the Federal Reserve raising interest rates to combat inflation.
Sales at wholesalers increased by 0.4% in October after gaining 0.1% in September. It would take 1.32 months for wholesalers to clear shelves, unchanged from September's sales pace.