The Commerce Department reported Wednesday that inventories held by businesses on shelves and backlots rose by 0.3 percent in August, the weakest gain since inventories were up just 0.2 percent in March.

The increase was below the 0.5 percent rise that economists had expected and sharply lower than the 1.1 percent jump in July.

Economists are watching to see whether business confidence begins to falter as the economy weakens. Business plans on inventory growth and investment spending are key factors influencing economic activity.

Analysts said the slowdown in inventory growth could also be reflecting the serious problems in the market for commercial paper, which are short-term loans that businesses receive to fund their day-to-day operations such as buying inventories. That market has frozen up in recent months as banks have grown concerned about the risks of bad loans.

In one of many emergency measures implemented by the government during the current credit crisis, the Federal Reserve has announced that it will start a program later this month to support the commercial paper market in an effort to get those loans back to more normal levels.

The 0.3 percent rise in inventories in August reflected a big jump of 0.8 percent in stockpiles held by wholesalers and a rise of 0.6 percent in manufacturing inventories. Stockpiles held by retailers dropped by 0.6 percent.

Total business sales in August fell by 1.8 percent, led by a 3.5 percent plunge in sales by manufacturers. Sales by wholesalers were down 1.5 percent and sales at the retail level fell by 0.5 percent.