WASHINGTON - U.S. wholesale businesses increased their stockpiles in November but at less than half the pace of October when they had jumped by the largest amount in two years.
Wholesalers boosted stockpiles 0.5 percent in November compared with October when inventories had increased 1.3 percent, the Commerce Department reported Friday. The October gain had been the biggest one-month increase since a 1.5 percent rise in October 2011.
Sales were solid in both months, rising 1 percent in November following a 1.1 percent increase in October.
Rising stockpiles boost growth because it means factories have produced more goods. Robust restocking contributed two-fifths of the 4.1 percent growth rate in the July-September quarter. Economists say growth slowed in the fourth quarter in large part because they believe the pace of restocking slowed following the third quarter surge.
With the November gain, inventories at the wholesale level stood at a seasonally adjusted $516.4 billion, 3.3 percent higher than a year ago.
The government tracks inventories held by wholesalers, manufacturers and retailers. A report covering all inventory levels will be released next Tuesday.
At the wholesale level, auto stockpiles dropped by 0.8 percent in December while stockpiles of computer equipment rose 3 percent after a big 5.7 percent decline in October.
Recently, various signs of strength including a big improvement in the trade deficit have prompted economists to boost their forecasts for fourth quarter growth.
Some now believe growth will be around 3 percent, an upgrade from early estimates that growth would be less than 2 percent.