March factory orders, shipments climb
WASHINGTON (Reuters) - U.S. factory orders surged in March, posting a fifth straight monthly increase that showed a healthy manufacturing sector well placed to support economic recovery.
The Commerce Department said on Tuesday new orders for manufactured goods rose 3 percent to a seasonally adjusted $463 billion, well above Wall Street economists' forecasts for a 1.9 percent pickup.
In addition, February orders that had been reported as dropping by 0.1 percent were sharply revised to instead show a 0.7 percent increase.
A cheaper U.S. dollar has helped export industries and there are signs that producers are boosting investment in plants and equipment to benefit from it.
Orders for costly durable goods, items designed to last three years or more, were up 2.9 percent in March, the department said, an upward revision from a 2.5 percent gain it had earlier reported.
Financial markets showed no response to the data.
Orders for nondefense capital goods excluding aircraft -- often taken as an indicator of businesses' future investment plans -- were revised to show a 4.1 percent rise in March instead of a 3.7 percent gain. That followed a 0.9 percent increase in February.
It was the strongest rise in investment plans since a 5.1 percent increase last August.
Ian Lyngen, senior government bond strategist at CRT Capital Group in Stamford, Connecticut, called it "a solid report with lingering weakness from early in the first quarter."
Excluding volatile transportation goods, March orders climbed by 2.6 percent following a 0.6 percent February rise
-- an eighth straight gain in this key orders category.
Orders for primary metals, machinery and electrical equipment all were higher in March though orders fell for fabricated metal products and computers.
The strong orders report fit with other recent signs that factories are in a position to bolster recovery from the recession that followed the 2007-2009 financial crisis, provided that costs for energy and other necessary inputs are controlled.
On Monday, the Institute for Supply Management said its gauge of factory activity eased to 60.4 in April from 61.2 in march -- still a brisk level since any reading over 50 shows business is expanding.
(Reporting by Glenn Somerville, Additional reporting by Ellen Freilich in New York; Editing by Andrea Ricci)