January factory orders surge 3.1 percent on aircraft

WASHINGTON (Reuters) - New orders received by factories leaped 3.1 percent in January, marking their biggest increase since September 2006 on a massive surge in aircraft orders as the manufacturing outlook signaled a continuing improvement.

The Commerce Department said on Friday that the increase in factory orders to $445.6 billion in January compared to an upwardly revised 1.4 percent increase in December.

The January increase outstripped consensus forecasts for a 2.0 percent rise from analysts polled by Reuters after December's orders were originally reported as just a 0.2 percent gain.

The typically volatile non-defense aircraft category rose by a stunning 5,137 percent to $7.4 billion in January from $141 million in December. This offset declines in some sectors, such as a 5.9 percent drop in computers and electronic products and a 12.6 percent drop in machinery orders. Orders for primary metals, meanwhile, rose 3.1 percent in January.

Unfilled orders rose 0.6 percent in January following a revised decline of 0.2 percent in December, the Commerce Department said.

(Reporting by David Lawder; Editing by James Dalgleish)