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Economy

October 18, 1994|From Times Staff and Wire Reports

Inventories Up 1% in August: Businesses built up their stockpiles at a rapid pace in August despite the fastest sales in 7 1/2 years, the Commerce Department said. Inventories rose 1%, the fifth consecutive advance and the biggest since 1.2% in May, the department said. Sales rose 3% as auto dealers restocked after shutting down in July to retool for 1995 models. Analysts said the figures are fresh evidence of economic strength, increasing the chances that the Federal Reserve Board will raise interest rates again next month. Analysts said the inventory increase will probably inflate the economic expansion in the third quarter to about 3%, making another boost in short-term interest rates by the Fed more likely when central bank policy-makers meet.

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