Wholesale businesses increased their stockpiles sharply in December although the gains are expected to slow in coming months, a development that could curb overall economic growth.
The Commerce Department says wholesale businesses boosted inventories by 1 percent in December after no increase in November. The rise came as sales rose 1.3 percent, the best showing in nine months and more than double the 0.5 percent November sales gain. The gain pushed stockpiles to $473.9 billion, 22.5 percent above their 2009 lows.
Strong inventory growth was a major factor boosting growth in the final three months of the year, but this trend is expected to slow in the early part of this year. That is a major reason economists are looking for slower overall economic growth in the current January-March period.