Wholesale inventories growth in August revised lower

The Commerce Department's Census Bureau reported on Thursday that US wholesale inventories rose by a lower-than-expected 0.5% in August, according to revised figures. Previously, inventories had been recorded as having increased by 0.7% during the same period. This adjustment comes after strong demand led to a surge in sales during August.

The stocks at wholesalers grew by 1.4% in July, compared to the revised 0.5% growth in August. On a year-over-year basis, inventories advanced by 6.4% in August. However, durable goods inventories at wholesalers grew by a slightly smaller 0.8%, while stocks of nondurable goods remained unchanged, with petroleum inventories decreasing by 3.9%.

Businesses have been actively rebuilding their inventories, which had been steadily declining for five consecutive quarters due to robust domestic demand, primarily driven by consumer spending and investment in artificial intelligence. This inventory rebuilding has resulted in a notable increase in imports, with capital goods imports reaching a record high in August, suggesting that business spending on equipment likely remained strong throughout the July-September quarter.

Economists estimate that trade could subtract up to 2.5 percentage points from third-quarter GDP growth. Nonetheless, they expect a contribution from inventories, having already removed 0.53 percentage point from the second-quarter growth estimate. Overall, growth projections for the third quarter remain around a 3.0% annualized rate, which also takes into account the strong consumer spending.

The economy expanded at a 2.2% pace in the second quarter. Sales at wholesalers increased by 1.8% in August, following a 1.0% rebound in July. At the August sales pace, it would take an average of 1.18 months to deplete the shelves, a slight decrease from 1.19 months in July. The inventories/sales ratio stood at 1.28 months in August 2025.