WASHINGTON (AP) — U.S. wholesalers expanded stockpiles modestly in March even though their sales fell for an eighth straight month.
Wholesale stockpiles edged up 0.1 percent following a 0.2 percent rise in February, the Commerce Department reported Friday. Sales at the wholesale level fell 0.2 percent after an even bigger 0.6 percent drop in February. Sales have fallen every month since August.
Economists are expecting sales to rebound in the coming months as the warmer weather lures shoppers back to shopping malls and auto dealerships. The pickup should fuel consumer spending, which accounts for 70 percent of economic activity.
Higher demand at the retail level would then spur increased restocking at all levels of business including wholesalers.
In March, auto stockpiles at the wholesale level were up 0.2 percent while furniture stockpiles increased 2.2 percent while inventories of computer equipment increased 1.7 percent. But stockpiles of lumber were down 0.8 percent and farm products were down 2.8 percent.
Total wholesale inventories increased to a seasonally adjust $574.5 billion in March, up 5.1 percent from a year ago.
Overall economic growth, as measured by the gross domestic product, barely grew in the January-March quarter. Many economists believe GDP will turn negative when the government issues a revision next month, reflecting a major widening in the trade deficit in March.
First quarter activity was hurt by an unusually severe winter, falling oil prices that triggered a big cutback in investments by energy companies and a rising dollar that has hurt U.S. export sales.
But economists remain hopeful that growth will rebound with warmer weather and continued strong gains in employment. They forecast overall GDP growth of between 2 percent and 2.5 percent in the current April-June period and then climb above 3 percent in the second half of this year.