Inventories at U.S. wholesalers grew in March but were unable to keep pace with a second straight month of surging demand, the Commerce Department reported Friday.
Stocks on hand at wholesalers grew by 0.6 percent in March, well below the 2.7 percent gain registered by wholesale sales. February inventories were unrevised at a 1.2 percent gain, while February sales were revised upward, to a 2.1 percent increase. The March sales jump was the largest since August 1994, Commerce said.
Wall Street economists had expected a 0.5 percent increase.
The sales gain brought a key measure of how lean companies are keeping their inventories to a record low and increases the likelihood that firms will ramp up production or boost imports from abroad as demand grows.
The stock-to-sales ratio, a gauge of how long it would take to draw down stocks at the current sales pace, fell to a record low 1.13 months’ worth in March, from 1.16 months’ in February. The ratios for some durable goods also fell sharply.
The stock-to-sales ratio for professional equipment hit a record low of 1.07 months, while the ratios for metals and hardware slipped to levels not seen since 1996.
Metals sales and inventories both posted record gains, with sales in that sector surging 14.4 percent in the month.
The wholesale inventories make up one third of the data reported in the monthly business inventories report, set for release on May 14.
March factory inventories, reported earlier this month, showed a 0.3 percent increase. The battered U.S. factory sector has been showing signs of a solid revival in recent months.