WASHINGTON (AP) – Stockpiles held by wholesale businesses rose in October, while sales posted a smaller gain.
Stockpiles at the wholesale level increased 0.4 percent, matching September’s figure, the Commerce Department reported Tuesday. Sales edged up just 0.2 percent during the month after a flat reading in September and a 0.8 percent drop in August.
Economists are watching closely to see if businesses become reluctant to expand inventories in the face of weaker sales. That could drag on economic growth because the restocking of store shelves spurs orders to manufacturers, which in turn boosts factory production.
But any cutback in inventory building could be a sign that businesses are worried about future sales.
The October gain in stockpiles pushed inventories at the wholesale level to a seasonally adjusted $542 billion in October, an increase of 6.8 percent from the level a year ago.