NEW YORK (CNN/Money) - Inventories at U.S. businesses rose in July, the government said Monday, the third straight month of gains following a prolonged inventory selloff.

The Commerce Department said business inventories rose 0.4 percent after rising a revised 0.3 percent in June. Economists, on average, expected inventories to grow 0.2 percent in July, according to Briefing.com.

Sales rose 1.2 percent after rising 0.3 percent in June, and the ratio of inventories to sales was 1.35 months' worth, compared with 1.36 in June.

Wall Street yawned at the data, and stock market futures were mixed. Treasury bond prices were lower.

Federal Reserve Chairman Alan Greenspan and other economists have long warned that business spending would be the key to the economy's recovery from a recession that began in March 2001.

Recent gains in business inventories are hopeful signs that businesses have been spending more, but sales will also have to rise to keep inventories from growing too much. An inventory build-up contributed to a dramatic slowdown in manufacturing in 2000-2001.