WASHINGTON (Reuters) - Business inventories rose modestly in November as sales rose solidly, backing views restocking will not support economic growth in the fourth quarter.
The Commerce Department said on Tuesday inventories increased 0.3 percent to a record $1.62 trillion after rising by the same margin in October.
The gain in November was in line with economists’ expectations. Automobile inventories rose 0.5 percent after increasing 0.8 percent in October.
Inventories are a key component of gross domestic product changes. Retail inventories, excluding autos -- which go into the calculation of gross domestic product -- were up only 0.2 percent after rising 0.4 percent the prior month.
Inventories accounted for almost a quarter of the economy’s annual 3.1 percent growth pace in the third quarter. Economists expect a drawdown on inventories in the fourth quarter, which would be a drag on growth.
Business sales rose 1.0 percent to a record $1.27 trillion in November after falling 0.3 percent the prior month.
At November’s sales pace, it would take 1.28 months for businesses to clear shelves, unchanged from October.
Reporting By Lucia Mutikani; Editing by Andrea Ricci