Sales at the wholesale level posted a slight increase in September, while worker productivity increased during the third quarter of the year.
The U.S. Commerce Department reported Thursday wholesale sales moved up 0.1% after August sales were revised down from 0.9% to 0.8%.
"The wholesale report was no surprise after earlier reports of a similar 0.1% gain in non-auto retail sales, non-auto manufacturing sales and the Producer Price Index," said Newport Communications Senior Economist Jim Haughey. "The obvious conclusion is that the economy stalled in September after strong growth in July and modest growth in August. This is confirmed by the 0.5% September gain in wholesale inventories after several steady months."
Haughey says the September information is not good for dry van carriers because non-durable sales slipped 0.3% following a 1.6% rise in August. Durable goods shipped in dry vans also slipped. Furniture declined 1.1%, electrical 0.5%, hardware 0.9% and miscellaneous goods 4.2%. Of these, only furniture declined for the full third quarter.
"This slowdown probably prompted the Federal Reserve Board to make the precautionary 0.5% cut in interest rates earlier this week," he said. "But there is nothing in the economic environment to suggest that the slowdown will continue. Investment and trade have recently turned positive after a long slump. Together with small income gains, this should be enough to keep consumer spending rising modestly in the current quarter unless nervousness about Iraq intervenes."
Meantime, a separate report released by the U.S. Labor Department showed productivity grew at an annual rate of 4% in the third quarter of the year, the strongest showing since the beginning of this year.
Productivity, which is the amount of output per hour of work, increased after growing by a sluggish 1.7% pace in the second quarter of this year. Over the past four quarters productivity registered 5.3%, the largest gain since 1973.
The U.S. Commerce Department reported Thursday wholesale sales moved up 0.1% after August sales were revised down from 0.9% to 0.8%.
"The wholesale report was no surprise after earlier reports of a similar 0.1% gain in non-auto retail sales, non-auto manufacturing sales and the Producer Price Index," said Newport Communications Senior Economist Jim Haughey. "The obvious conclusion is that the economy stalled in September after strong growth in July and modest growth in August. This is confirmed by the 0.5% September gain in wholesale inventories after several steady months."
Haughey says the September information is not good for dry van carriers because non-durable sales slipped 0.3% following a 1.6% rise in August. Durable goods shipped in dry vans also slipped. Furniture declined 1.1%, electrical 0.5%, hardware 0.9% and miscellaneous goods 4.2%. Of these, only furniture declined for the full third quarter.
"This slowdown probably prompted the Federal Reserve Board to make the precautionary 0.5% cut in interest rates earlier this week," he said. "But there is nothing in the economic environment to suggest that the slowdown will continue. Investment and trade have recently turned positive after a long slump. Together with small income gains, this should be enough to keep consumer spending rising modestly in the current quarter unless nervousness about Iraq intervenes."
Meantime, a separate report released by the U.S. Labor Department showed productivity grew at an annual rate of 4% in the third quarter of the year, the strongest showing since the beginning of this year.
Productivity, which is the amount of output per hour of work, increased after growing by a sluggish 1.7% pace in the second quarter of this year. Over the past four quarters productivity registered 5.3%, the largest gain since 1973.
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