New orders for key U.S.-made capital goods fell in November after four straight months of increases, but further gains in shipments suggested that business spending on equipment will probably remain robust in the fourth quarter.
The Commerce Department said on Friday that orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, slipped 0.1 percent last month. Data for October was revised to show these so-called core capital goods orders jumping 0.8 percent instead of the previously reported 0.3 percent gain.
Economists polled by Reuters had forecast orders of these so-called core capital goods increasing 0.5 percent last month. Core capital goods orders gained 5.1 percent on a year-on-year basis.
November's dip is likely to be temporary after Republicans in the U.S. Congress passed a tax cut package worth $1.5 trillion, the largest overhaul of the tax code in 30 years.
The package, which slashes the corporate income tax rate to 21 percent from 35 percent, is a major legislative victory for President Donald Trump. The Trump administration argues that the tax cut will boost business spending though many economists believe companies will use much of the windfall on share buy-backs and debt reduction.