U.S. business inventories increased 0.6% in February 2008 to $1.468 trillion, the U.S. Commerce Department announced Monday.

Economists surveyed by Bloomberg News had expected inventories to increase by 0.6% in February 2008.

Meanwhile, sales declined 1.1% in February 2008, the category's largest drop since January 2007.

Also, the inventory-to-sales ratio, an indicator of demand, increased to 1.28 in February 2008 from 1.26 in January 2008.

Economists, business executives, monetary officials and investors/traders monitor the inventories statistic because it can indicate business optimism and/or growing sales in the months ahead.

Further, the ratio of inventories-to-sales can help investors determine whether production demand will expand or contract in the near future -- a major factor in U.S. GDP growth.

Economic Analysis: A sub-par February 2008 business inventories report. The key statistic is the 1.28 inventory-to-sales ratio, which continues to increase. It's been rising since late 2007 -- and a sustained rise historically indicates, at minimum, economic sluggishness up ahead; at worst, a recession. For example, the ratio increased throughout 2001, prior to the start of the U.S.'s last recession. Conversely, it decreased throughout the ensuing, nearly 6-year economic expansion.