Businesses restocked at a faster pace in December, a positive sign that they expect consumer demand to rise.
The Commerce Department says business stockpiles grew 0.4 percent in December, after a 0.3 percent rise in the previous month. Sales rose 0.7 percent after a 0.4 percent gain in November.
Companies are building up their stockpiles again after cutting them over the summer amid recession fears. Higher inventories require more production, which boosts economic growth. It also suggests companies expect more sales.
Rising inventories were a key reason growth accelerated in the final three months of last year. Still, some economists expect the restocking to slow this year.
Wholesalers reported a 1 percent increase in inventories. Retailers reported a 0.2 percent gain and manufacturers 0.1 percent.