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Wholesale companies add to their stockpiles for 16th straight month in April as sales increase

By Martin Crutsinger, The Associated Press  | June 09, 2011
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In this June 2, 2011 photo, shoppers Leslie Corridon, left, and Leslie Christon walks the aisles at a Sam's Club store in Rogers, Ark. Wholesale companies added to their stockpiles in April for a 16th straight month, a sign that businesses were confident in future sales gains. However, fresh data since then has shown the economy has weakened, suggesting supply levels could shrink in the months to come. (AP Photo/Danny Johnston)
In this June 2, 2011 photo, shoppers Leslie Corridon, left, and Leslie Christon walks the aisles at a Sam's Club store in Rogers, Ark. Wholesale companies added to their stockpiles in April for a 16th straight month, a sign that businesses were confident in future sales gains. However, fresh data since then has shown the economy has weakened, suggesting supply levels could shrink in the months to come. (AP Photo/Danny Johnston)

WASHINGTON - Wholesale companies added to their stockpiles in April for a 16th straight month, a sign that businesses were confident in future sales gains. However, fresh data since then has shown the economy has weakened, suggesting supply levels could shrink in the months to come.

Inventories rose 0.8 per cent in April to $447.2 billion, the highest level since October 2008, the Commerce Department reported Thursday. Sales increased 0.3 per cent to $395.5 billion, marking the ninth sales gain in the past 10 months.

Companies boosted their stockpiles of furniture, machinery, paper, clothing and chemicals. Stockpiles of autos, lumber and computer equipment declined.

Wholesale inventories have increased 16.6 per cent since hitting a low in September 2009. U.S. manufacturing has been one of the strongest sectors of the economy since the recession ended two years ago.

But a report from the Institute for Supply Management showed that factory activity cooled in May, expanding at the slowest pace in 20 months. Supply disruptions stemming from the Japan crises have led to shortages of auto and electronics parts. High gas prices are also hurting consumer spending, which makes up 70 per cent of economic activity.

Economists said they expect manufacturing to continue growing, but they cautioned that gains in coming months may be smaller.

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