Inventory Growth Slowest in Over a Year

U.S. wholesaler inventories grew in September at the slowest pace in almost a year and a half as sales increased more than expected, government figures showed Wednesday.

Wholesale inventories rose 0.2% after rising 0.6% in August, the Commerce Department said. Sales at the nation’s wholesalers increased 0.7% in September after rising a revised 0.2% during August.

“There’s no doubt about it--inventories are running at much leaner levels than past business cycles,” though stockpile levels are still subject to sudden shifts in demand, said William Sullivan, an economist at Morgan Stanley Dean Witter in New York.

September’s increase in inventories was the smallest since a 0.1% rise in April 1999, Commerce officials said. The inventory-sales ratio, which tracks the amount of time goods sit unsold, was unchanged at 1.30 months in September.

Separately, the Labor Department reported the import price index fell 0.5% in October, the first drop in six months. Lower prices for petroleum and machinery led the decline. Excluding petroleum, import prices were unchanged in October after a 0.2% September drop.

Analysts had expected a 0.5% increase in inventories in September, according to a Bloomberg News survey. Analysts also expected sales to increase 0.4% in September after August’s originally reported gain of 0.3%.

By category, wholesale stockpiles of petroleum products declined 4.6% in September after rising 2.9% during August. Sales of petroleum products at wholesalers surged 8.2% in September after falling 2.6% during August.