Business stockpiles growing
WASHINGTON — U.S. companies restocked their shelves at a solid pace in August while sales rose for a second straight month. The combination of higher stockpiles and increased sales should help to boost economic growth.
Business inventories grew 0.6 percent in August following a July gain of 0.8 percent that had been the strongest since January, the Commerce Department said Monday. Sales were up 0.5 percent in August following a 0.9 percent rise in July that followed a big drop in June.
Companies typically boost their stockpiles when they anticipate sales will rise in coming months. Faster restocking helps drive economic growth. When businesses order more goods, it typically leads to more factory production.
Total business stockpiles rose to $1.60 trillion. That is 22.4 percent higher than the low reached in September 2009.
For August, inventories rose 0.6 percent at the manufacturing and retail levels and were up 0.5 percent at wholesale businesses.
The sales increase reflected gains at both the retail and wholesale levels which offset a 0.3 percent drop in sales by manufacturers.
In a separate report Monday, the government said retail sales rose a strong 1.1 percent in September, a positive sign for the economy as businesses will likely restock in coming months to meet rising demand.
Wholesale stockpiles account for about 27 percent of total business inventories.
