P.M. BRIEFING : Inventories Edge Up, Sales Dwindle

Business inventories rose 0.4% in June while sales fell 0.3%, the government said today.

Inventories often rise during periods of slow economic growth as production outpaces demand, often leading to a loss of jobs as industry curtails output until the goods are sold. However, analysts do not consider the June inventory-

to-sales ratio unusually high.

The Commerce Department reported that inventories held on shelves and back lots climbed to a seasonally adjusted $780.8 billion in June after increases of 0.9% in May and 0.8% in April.

Business sales, meanwhile, dropped to a seasonally adjusted $516.4 billion after rising 0.1% in May and 2.0% in April.

The June business activity produced a slight increase in the ratio of inventories to sales. It was 1.51, meaning it would take 1.51 months to exhaust inventories at the June pace. The ratio stood at 1.50 in May and 1.49 in April.