Plunging oil prices push US wholesale sales down 2% - UPDATE 1 09.06.2003 16:08 Headlines
WASHINGTON (AFX) - Plunging oil prices led to a record 2 percent decline in
U.S. wholesale trade sales in April, the Commerce Department reported Monday.
In March, total wholesale trade sales rose 1 percent. Sales are up 3.8 percent
in the past 12 months. Read the full report.
Sales of wholesale petroleum dropped a record 24 percent in April, pushing down
sales of non-durable goods a record 3.6 percent. The data go back to 1992.
Sales of durable goods at the wholesale level dropped 0.2 percent in April
following a 2.1 percent gain in March.
Meanwhile, wholesale inventories sank 0.1 percent after rising 0.4 percent in
March. With sales falling faster than inventories, the inventory-to-sales ratio
bounced to 1.23 in April from a record low 1.21 in March.
Inventories are still extremely tight, which means that any increase in demand
from retailers would soon be answered by increased orders to manufacturers.
The drop in sales won't worry policymakers at the Federal Reserve or investors
who wonder when this economy will finally perform up to its potential. Lower
energy prices should give both consumers and businesses more free cash to spend
on other goods and services.
The 1.8 percent drop in auto sales would be more worrisome, but analysts know
auto sales have been very volatile month-to-month. Automakers have already
reported mildly disappointing sales figures for May, so April's data is
outdated.
Sales of computer equipment rose 1.5 percent, while sales of electrical
equipment rose 1.1 percent. Sales of machinery advanced 0.4 percent.
Sales of chemicals fell 1 percent, likely due to price movements.
Sales in most other industrial sectors showed modest gains or declines in April.
This story was supplied by CBSMarketWatch. For further information see
www.cbsmarketwatch.com.
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