U.S.
durable goods orders rise less than expected
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[April 26, 2016]
WASHINGTON, April 26 (Reuters) - -
Orders for long-lasting U.S. manufactured goods rebounded less than
expected in March as demand for automobiles, computers and electrical
goods slumped, suggesting the downturn in the factory sector was far
from over.
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The Commerce Department said on Tuesday that orders for durable
goods, items ranging from toasters to aircraft meant to last three
years or more, increased 0.8 percent last month after a downwardly
revised 3.1 percent decline in February.
Orders for durable goods were previously reported to have dropped
3.0 percent in February.
Non-defense capital goods orders excluding aircraft, a closely
watched proxy for business spending plans, were unchanged after a
downwardly revised 2.7 percent decline in the prior month. These
so-called core capital goods orders were previously reported to have
decreased 2.5 percent in February.
Economists polled by Reuters had forecast durable goods orders
advancing 1.8 percent last month and orders for manufactured capital
goods increasing 0.8 percent.
While most manufacturing surveys have painted a fairly upbeat
picture of the sector in recent months as the dollar rally fizzles,
so-called hard data such as industrial production and factory orders
have remained depressed.
Manufacturing, which accounts for 12 percent of the U.S. economy, is
struggling with the lingering effects of the dollar's past surge and
sluggish overseas demand.
Deep spending cuts on capital projects by oilfield service firms
like Schlumberger <SLB.N> and Halliburton <HAL.N> in the aftermath
of a prolonged tumble in oil prices, and efforts by businesses to
sell a stockpile of unwanted inventory are also hurting factories.
The rise in durable goods orders last month was led by a 65.7
percent jump in defense aircraft orders, which lifted bookings for
transportation equipment 2.9 percent.
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Orders for civilian aircraft fell 5.7 percent despite Boeing
reporting on its website that it had received orders for 69 aircraft
last month, up from just two in February. Orders for motor vehicles
and parts fell 3.0 percent as demand for automobiles has softened in
recent months after sales hit a record high in 2015.
There were increases in orders for primary metals and machinery.
Orders for computers and electronic products fell as did those for
electrical equipment, appliances and components.
Despite manufactured capital goods orders being flat last month,
shipments of core capital goods - used to calculate equipment
spending in the gross domestic product report - rose 0.3 percent
after slumping 1.8 percent in February.
(Reporting by Lucia Mutikani; Editing by Paul Simao)
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