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The economy grew at a tepid 1.9 percent annual pace in the January-March quarter, down from 3 percent annual growth at the end of last year. A key reason for the winter slowdown was that companies restocked more slowly. Nearly two-thirds of the economic growth at the end of last year came from a surge in restocking. Most economists don't expect much pickup in growth in the April-June quarter, while some predict growth slowed. High unemployment and meager pay raises have made consumers more cautious about spending. Consumer spending, which drives roughly 70 percent of economic activity, was flat in May. Wholesale stockpiles account for about 27 percent of total business inventories. Stockpiles held by retailers make up about one-third of the total and manufacturing inventories represent about 40 percent.
[Associated
Press;
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