Factory Orders Surprisingly Strong in April
New orders at US factories rose by a sharper-than-expected 1.1 percent in April as strong demand for quickly used nondurable goods offset a dip in orders for costly durable goods, the Commerce Department reported on Tuesday.
The April pickup in overall factory orders followed an upwardly revised increase of 1.5 percent in March orders that previously was reported as a 1.3 percent gain.
Excluding transportation items, factory orders posted back-to-back 2.6 percent increases in each of March and April, implying the industrial sector still retains considerable vigor. Shipments of finished goods rose 2.2 percent in April, the strongest monthly pickup since December 2006.
Orders for costly durable goods - items like cars and refrigerators intended to last three years or more - declined by a revised 0.6 percent in April rather than the 0.5 percent drop previously reported. That followed a 0.2 percent decrease in March.
Wall Street economists surveyed by Reuters had forecast that total factory orders would decline by 0.1 percent in April and that durable goods orders would be down 0.5 percent.
Nondefense capital goods orders excluding aircraft, which some economists view as a proxy for business investment, climbed by a revised 4 percent in April, slightly less than the 4.2 percent gain previously reported, after contracting by 1 percent in March.