Capital goods orders by U.S. firms surged in August, indicating that economic recovery remains on course. The data follows yesterday’s reports that showed that the number of individuals who filed for jobless claims rose marginally last week.
“This is supportive of the U.S. economy continuing to expand at a healthy pace in the second half of the year,” Sam Bullard, a Charlotte, North Carolina-based senior economist at Wells Fargo Securities, told Reuters.
Orders for non-defense capital goods minus aircraft, which is a key indicator of business spending, grew 0.6 percent. Orders for the core capital items had plunged by a revised 0.2 percent in July. The Commerce Department had initially reported that orders for core capital goods fell 0.7 percent in July.
Orders for durable goods such as aircraft and toasters, which are items expected to last at least three years, plunged 18.2 percent. However, orders for long-lasting manufacturing goods had jumped in July due to an upsurge in aircraft orders.
Durable goods orders jumped 22.5 percent in the month of July, the most since the index began to be monitored in 1992, after orders for civilian aircraft surged 315.6 percent.
Transportation orders fell 42.0 percent in August due to a 74.3 percent decline in aircraft orders. Boeing announced that aircraft orders in August were 107, a third of those received in July. Automobile orders declined 6.4 percent after jumping 10.0 percent in July.
Meanwhile, fresh applications for state unemployment benefits grew 12,000 to 293,000 in the week through Sept. 20, reported the Labor Department. Economists surveyed by Reuters had expected the claims to increase to 300,000. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
To contact the reporter of this story; Jonathan Millet at firstname.lastname@example.org