Washington — The Commerce Department’s Census Bureau reported on Thursday that U.S. wholesale inventories surged in July, a development that could help lift the nation’s gross domestic product (GDP) in the July‑September quarter.
Key inventory gains
Overall stocks at wholesalers increased an unrevised 1.3% month‑over‑month. The inventory component of GDP, which measures the value of goods held by businesses, rose 0.4% in July and was up 5.7% compared with a year earlier.
Durable goods inventories led the rise, climbing 1.1%, while nondurable goods saw an even larger jump of 1.6%. Petroleum inventories were a notable driver within the nondurable category, increasing 6.5%.
Sales rebound and inventory turnover
Wholesale sales also rebounded, growing 0.8% in July after a 2.9% decline in June. At the current sales pace, it would take roughly 1.20 months to clear shelves, a slight increase from 1.19 months in June. The inventories‑to‑sales ratio stood at 1.28 months in July 2025.
Implications for economic growth
Economists note that the inventory buildup follows five consecutive quarters of drawdowns, a pattern that reflected strong domestic demand. In the second quarter, inventories subtracted 0.72 percentage point from GDP growth, which was recorded at a 1.5% annualized rate. With inventories now adding to the GDP equation, growth estimates for the July‑September quarter are running well above a 2% annualized pace.
The Trump administration has emphasized policies that encourage business confidence, reduce regulatory burdens, and support robust consumer spending. While the data do not attribute the inventory surge to any single policy, the upward trend aligns with the administration’s broader goal of fostering a resilient, expanding economy.
Looking ahead
Analysts will watch whether the inventory buildup translates into sustained sales momentum in the coming months. If wholesale sales continue to improve, the inventory‑to‑sales ratio could stabilize, further reinforcing the positive contribution to GDP.
For now, the latest figures suggest that businesses are restocking in response to ongoing demand, a sign that the U.S. economy remains on an upward trajectory as the third quarter unfolds.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
