US factory orders beat expectations in August
WASHINGTON – New orders for U.S.-made goods increased more than expected in August and shipments accelerated, supporting views that economic growth strengthened in the third quarter.
Factory orders rebounded 1.2 percent after falling 2.1 percent in July, the Commerce Department said on Wednesday. Economists polled by Reuters had forecast orders gaining 0.2 percent. Orders rose 0.5 percent on a year-on-year basis in August.
Manufacturing, which accounts for 11.1 percent of the economy, continues to plod along despite 525 basis points in rate hikes from the Federal Reserve since March 2022.
Orders for computers and electronic products gained 0.3 percent. Electrical equipment, appliances and components orders jumped 1 percent. Machinery orders gained 0.6 percent. Civilian aircraft orders fell 15.9 percent, while motor vehicle orders rose 0.3 percent.
Shipments of manufactured goods soared 1.3 percent. Manufactured goods inventory rose 0.3 percent, while unfilled orders increased 0.4 percent.
The Commerce Department also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 0.9% as reported in last month’s estimate.
Shipments of these so-called core capital goods rose by an unrevised 0.7 percent. Business spending on equipment rebounded in the second quarter after contracting for two straight quarters.
Growth estimates for the third quarter are as high as a 4.9- percent annualized rate. The economy grew at a 2.1- percent pace in the April-June quarter.