WASHINGTON (AP) — U.S. wholesale businesses left their inventories unchanged as their sales fell in July.
The Commerce Department said Friday that wholesalers held the line on stockpiles after increasing them 0.3 percent in June. Their sales fell 0.4 percent in July, reversing a 1.7 percent increase in June. It was the biggest sales drop since January’s 1.9 percent decline.
The July numbers show continued stress in the energy industry, which has been pinched by low oil and natural gas prices. Petroleum wholesalers reduced inventories by 1.2 percent and recorded a 3.5 percent drop in sales in July. Grocery wholesalers recorded a 2 percent drop in sales but increased inventories by 0.9 percent. Auto companies registered a 0.3 percent sales drop but increased inventories by 0.4 percent.
Weak inventory restocking has been a drag on U.S. economic growth. From April through June, businesses overall reduced inventories at the fastest pace since the fall of 2011. That’s one reason second-quarter economic growth came in at a lackluster 1.1 percent.