New orders for long-lasting U.S. manufactured goods rose more than expected in March and bookings for the prior month were much stronger than initially thought, pointing to continued strength in the manufacturing sector.
The Commerce Department said on Wednesday durable goods orders increased 2.5 percent after an upwardly revised 0.7 percent rise in February, which was previously reported as a 0.6 percent fall.
Continue Reading Below
Economists polled by Reuters had expected a 2.0 percent increase in March. Orders last month were buoyed by bookings for motor vehicles, transportation equipment and aircraft.
Excluding transportation, durable goods orders rose 1.3 percent after a revised 0.6 percent gain in February, which was previously reported as a 0.3 percent drop. Economists had expected this category to rise 1.8 percent.
Durable goods orders are a leading indicator of manufacturing and the report indicated vibrancy in the sector, even though the economy lost some momentum in the first quarter.
Government data on Thursday is expected to show economic growth slowed to an annualized rate of 2.0 percent or even less in the first three months of this year, held back by weak consumer spending and a bigger trade deficit. The economy grew at a solid 3.1 percent rate in the fourth quarter.
Outside of transportation, March orders for primary metals rose 3.9 percent, while machinery orders jumped 4.2 percent. However, orders for computers and electronic products, and communications equipment fell.
The Commerce Department report showed non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, rose 3.7 percent last month after an upwardly revised 0.5 percent gain in February. Economists had expected a 2.8 percent increase from a previously reported 0.7 percent fall.