WASHINGTON – Inventories held by U.S. businesses rose modestly in May, as retailers stocked up to meet customer demand.
The Commerce Department said Friday U.S. business inventories rose 0.2 per cent in May after edging up 0.1 per cent in April. Sales rose 0.2 per cent.
Manufacturers, pinched by weak global demand and a strong dollar that makes their products costlier in world markets, left inventories unchanged. Over the past year, factory inventories were down 3.0 per cent.
Meanwhile, retailers raised inventories by 0.5 per cent in May and 6 per cent over the past year, a sign they are confident that American shoppers will continue to spend.
Auto dealers expanded inventories by 0.7 per cent, furniture and appliance stores by 0.5 per cent and sellers of building materials and garden supplies by 1.1 per cent. But department stores cut inventories by 0.7 per cent.
A slowdown in restocking empty shelves has dragged down economic growth three straight quarters and helped limit growth to a lacklustre 1.1 per cent annual pace from January through March. Growth is expected to pick up in the second quarter on a rebound in consumer spending.