The United States recorded higher wholesale inventory growth in April because businesses stockpiled prescription drugs before new tariffs took effect. The Commerce Department released new data which showed inventory levels increased 0.2% instead of remaining steady as previously estimated.
The revised data demonstrates how businesses prepare for President Trump’s extensive import duties especially in the pharmaceutical industry. The April inventory levels of prescription medication increased by 1.3% while apparel and motor vehicles and professional equipment and grocery stocks also showed growth.
The inventory increase matches a larger trend of companies bringing in imports before tariffs become effective. The fast-paced import activities led to the largest trade deficit during the first quarter which caused GDP growth to become negative.
Wholesale sales experienced a 0.1% increase during April following a stronger March performance. The current sales rate indicates that wholesalers need 1.3 months to sell all their inventory without any changes from the previous month. The Trump administration’s trade policy volatility has led economists to predict that inventory levels will stay elevated.
