Business Inventories Rise

Business inventories unexpectedly increased in October, halting a slide of 13 consecutive declines, Manufacturing.Net reports. The small gain, along with a fifth straight increase in sales, raised hopes that businesses will begin restocking their depleted shelves, helping support the economic recovery.

Businesses increased inventories 0.2% in October, the Commerce Department said. That was better than the 0.3% drop economists had expected. Total business sales rose 1.1%. The hope is that steadily rising sales will encourage businesses to restock shelves, which will boost factory production and bolster a broad recovery.

The overall economy, as measured by the gross domestic product, rose at an annual rate of 2.8% in the July-September quarter, the first increase after a record four straight quarterly declines. Many economists expect it is growing at a similar pace in the current quarter. The increase in October inventories followed a 0.5% September decline. The biggest gain was a 0.4% rise in manufacturing inventories; wholesale inventories rose 0.3%.