Manufacturing sales for April fell 2.8% M/M, below expectations for a 2.0% sequential contraction and the third straight monthly decline driven by weakness in petroleum products (-11%) and motor vehicles (-8%).

There should be more room to the downside over the coming months, as unfilled orders (order backlog) start to moderate from pre-tariff levels…

… and sales decelerate faster than inventory balances.

As a result of these shifts, the near-term outlook for wholesale activity is weak too - with April’s 2.3% M/M decline missing big versus expectations for a 0.9% drop.