US business stockpiles jump 0.7 per cent in October, biggest gain since January

WASHINGTON – U.S. companies boosted their stockpiles at the fastest rate in nine months as their sales grew. The gain in restocking indicates businesses anticipated a healthy holiday shopping season.

The Commerce Department says business inventories increased 0.7 per cent in October, following a 0.6 per cent gain in September. Sales rose 0.5 per cent, above a 0.3 per cent gain the previous month.

The increase could signal better growth in the October-December quarter than some economists had anticipated. Greater restocking boosts growth because it requires more factory production.

Growth is still likely to slow from the July-September quarter’s robust 3.6 per cent annual rate, half of which came from a jump in restocking.

But consumers appear to be spending more, a trend that will help keep the economy growing at solid pace.