WASHINGTON – Stocks on U.S. wholesalers' shelves fell in April as sales posted their biggest gain in nearly three years, the government said Friday in a report that showed inventories at their leanest level in over 10 years.
The Commerce Department said wholesale inventories dropped 0.7 percent to a seasonally adjusted $281.76 billion in April after a revised 0.3 percent decline a month earlier. Economists polled by Reuters had expected inventories to rise 0.1 percent.
Sales at the wholesale level in April rose 1.6 percent to $228.48 billion after a revised gain of 0.1 percent in March. It was the biggest increase in wholesale sales since May 1999 and helped to push the stock-to-sales ratio down to 1.23 in April from 1.26 the prior month.
The department said that was the lowest inventory-to-sales ratio under its current record-keeping system, which dates back to January 1992.
Businesses cut inventories sharply over the last year after finding themselves with excess goods on their shelves as the U.S. economy slowed.
That process of inventory liquidation decelerated in the first quarter of the year and Friday's report is likely to lend weight to a view shared by many economists that businesses will start restocking shelves soon, which would boost economic growth.
Wholesale inventories of durable goods -- items meant to last three years or more -- fell 0.6 percent in April, reflecting a sharp 2.0 percent drop in automobiles. Auto sales at the wholesale level climbed 2.7 percent in the month.
Inventories of computer equipment, which were cut sharply over the past year, fell 1.2 percent in April.