WASHINGTON – U.S. businesses in March posted the biggest increases in inventories and sales since June.

The Commerce Department said Friday that business inventories rose 0.4 per cent from February. Sales rose 0.3 per cent.

The March increases ended months of falling sales and inventories.

Falling inventories have been a big drag on the U.S. economy. They trimmed economic growth by 0.3 percentage point from January through March, reducing the first-quarter increase to a lacklustre 0.5 per cent annual rate. Inventories have pulled economic growth lower for three straight quarters. The March inventory increase could reduce the drag on growth and lead to somewhat better numbers when the government revises the first-quarter numbers.

Manufacturers and wholesalers reported higher sales and bigger inventories in March. Retailers increased inventories by 1 per cent but saw sales slip 0.3 per cent.

Inventories of autos and auto parts rose 2.3 per cent in March, most since October 2013. The increased stockpiles reflect strong auto sales. Americans bought just over 1.5 million cars and trucks last month, giving the auto industry its best April ever.