US businesses increase stockpiles

Associated Press

WASHINGTON

U.S. businesses increased their stockpiles in July, but at a slower pace than in June. Sales also rose by a small amount.

Business inventories rose by a seasonally adjusted 0.2 percent in July, following June’s gain of 0.5 percent, the Commerce Department said Friday. The June increase in inventories was the most since a 0.9 percent gain in November of last year.

Sales rose 0.2 percent in July, matching the June gain.

Economists expect that inventory growth will strengthen further in coming months and help support overall economic expansion.

Annual GDP growth improved to 3 percent in the second quarter of 2017. That follows a lackluster 1.2 percent expansion in the first quarter, which was slowed partly because inventories subtracted from overall economic activity.

Economists believe businesses rebuilding their stockpiles could add as much as a half percentage point to overall economic growth in the current quarter.