Information out Wednesday showed that U.S. wholesale inventories rose in May. This, amid a strong increase in the automotive sector, but the Commerce Department report also said the pace of accumulation is slowing, supporting views that inventory accumulation was probably a drag on economic growth in the second quarter.
The department said on Wednesday wholesale inventories increased 0.4% as reported last month after advancing 0.8% in April. Wholesale inventories increased 7.7% on a year-on-year basis May.
The component of wholesale inventories that goes into the calculation of gross domestic product gained 0.2% in May.
An accumulation in inventories contributed to a 3.1% annualized increase in gross domestic product in the first quarter. Inventories are expected to have subtracted from GDP growth in the second quarter. The Atlanta Federal Reserve is forecasting the economy grew at a 1.3% rate in the second quarter.
The government will publish its advance second-quarter GDP growth estimate later this month.
