U.S. business inventories rose in June as car dealers restocked to meet demand, although sales at companies fell the most in over three years, the Commerce Department said on Tuesday.
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Inventories increased 0.1% to $1.58 trillion after rising by 0.3% in May.
Economists polled by Reuters had forecast inventories rising 0.2% in June. Inventories were lifted by a 1.6% rise in restocking by auto dealers, in line with strong demand for motor vehicles
from households earlier this year.
Inventories are a key component of gross domestic product. Retail inventories outside of autos - a measure which goes into the calculation of gross domestic product - edged 0.1% higher.
Inventories at manufacturers increased 0.1% in June.
In a more worrisome sign, business sales fell for the third straight month, dropping 1.1% to $1.23 trillion. At June's pace of sales, it would take 1.29 months for businesses to clear shelves, the highest measure for the reading since February 2010.