U.S. Durable-Goods Orders Rise Due to Demand for Jetliners
U.S. sales of big-ticket manufactured goods rose at the quickest pace in nearly three years in June, driven by surging demand for civilian aircraft.
Orders of durable goods--products designed to last at least three years, such as cars and refrigerators--grew a seasonally adjusted 6.5% from a month earlier, the Commerce Department said Thursday.
Economists surveyed by The Wall Street Journal projected a 3.8% increase.
Outside of transportation goods, orders rose 0.2%, reflecting a dip in demand on a range of goods such as cars and computers.
The report offered a mixed assessment of the economy. Durable-goods orders have risen steadily this year--they're up 5% in the first six months compared to the same period in 2016. That suggests that over the broader term, businesses and consumers are confident and able to boost spending, supporting stronger economic growth.
But the last month's rise in durable orders was contained largely in one segment of the economy--transportation--that is volatile. It largely reflects better business at aircraft makers like Boeing Co., which is benefiting from a rise in global passenger airline traffic and higher sales of jetliners.
Businesses outside of transportation cut capital spending last month. Orders for nondefense capital goods excluding aircraft--a proxy for spending on equipment and software--fell 0.1% after two months of solid gains. That marked the first drop since December.
Lower business investment, if sustained, would restrain the broader economy. Business investment spending is still up 2.8% this year compared to last.
Orders for cars fell 0.6% in June from May, but are up 1.6% this year over last.
The Commerce Department's durable-goods report can be accessed at: https://www.census.gov/manufacturing/m3/index.html
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(END) Dow Jones Newswires
July 27, 2017 08:45 ET (12:45 GMT)