
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, July 16, 1993                   TAG: 9307160113
SECTION: BUSINESS                    PAGE: B5   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Short

INVENTORY BUILDUP DISAPPEARS

Business sales grew 0.3 percent in May, outpacing a modest 0.2 percent growth in inventories and assuring analysts that stockpiles were being held in check.

"There are some pockets of problems," said economist Michael P. Niemira of Mitsubishi Bank in New York, "but it's within the retail component . . . and even there it's not universal. Overall, there's no inventory problem at all."

The Commerce Department reported Thursday that business sales totaled a seasonally adjusted $586.9 billion in May, up from $584.9 billion a month earlier.

Inventories totaled a seasonally adjusted $864.3 billion, up from $862.5 billion in April and the eighth straight increase.

The difference between inventories and sales resulted in an inventory-to-sales ratio of 1.47, meaning it would take 1.47 months to exhaust stockpiles at the May sales pace. Analysts said the ratio was not dangerously high and unlikely to lead to production cuts.

Retail inventories were unchanged in May after growing 0.5 percent a month earlier. Stocks on both the factory and wholesale levels rose 0.3 percent.

Retail sales grew 0.4 percent in May and the department in an advance estimate Wednesday said sales rose 0.4 percent again in June. May sales originally were estimated to be up just 0.1 percent.

Factory sales fell 0.5 percent in May, but sales at the wholesale level jumped 1.7 percent.

by CNB