US wholesale inventories fall sharply in January

WASHINGTON, March 19 (Reuters) - ‌U.S. wholesale ​inventories ​dropped sharply January, a trend that if sustained could result in inventory ‌investment being a drag on economic growth ⁠in the first quarter.

Stocks at wholesalers decreased 0.5% ‌after falling 0.1% in ‌December, the Commerce Department's Census Bureau said on Thursday. Inventories, a key part of gross ​domestic product, increased 1.0% on a year-over-year basis in January.

The Census Bureau is ⁠still catching up on data releases following delays caused by last ​year's government shutdown.

There were decreases in the stocks of motor vehicles, lumber, ​metals and hardware as well ‌as medication, chemical, farm products, petroleum and alcohol. Furniture, professional equipment, electrical ⁠and apparel inventory increased.

Business inventories added to the 0.7% annualized GDP growth pace in the fourth ⁠quarter, despite marking their third straight quarterly decline. The ​economy grew at a 4.4% pace in the July-September quarter.

Sales at wholesalers increased 0.5% in January after ‌surging 1.3% in December. At January's sales pace it would take 1.25 ‌months to clear shelves, down from 1.26 ⁠months in December. ‌The inventories/sales ratio ​was at 1.33 months in January 2025.

(Reporting by Lucia Mutikani; Editing by Chizu ‌Nomiyama )

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