Aircraft Orders Cause Factory Orders to Climb 3% Higher
New orders for U.S. factory goods rose sharply in February but a gauge of planned business spending slipped, suggesting factory activity continued to expand at a moderate pace.
The Commerce Department on Tuesday said orders for manufactured goods climbed 3.0 percent. Economists polled by Reuters had forecast orders advancing 2.9 percent.
Factory orders were boosted by the aircraft industry, which is prone to sharp swings. Civilian aircraft orders surged 95.1 percent. U.S. manufacturer Boeing had previously reported orders in February for 179 aircraft, up from two a month earlier.
Gains were modest when stripping out more volatile categories. Orders excluding transportation equipment increased just 0.3 percent.
Orders for non-defense capital goods excluding aircraft—seen as a measure of business confidence and spending plans—declined 3.2 percent instead of the previously reported 2.7 percent drop. While often looked at as a core reading for orders, this measure has also been quite volatile in recent months. In January, it rose 6.7 percent, the biggest gain since March 2010, according to revised readings.
The Commerce Department also said orders for durable goods, manufactured products expected to last three years or more, rose 5.6 percent instead of the 5.7 percent gain reported last week.