WASHINGTON -- Orders for long-lasting manufactured goods fell in April as demand for aircraft weakened. But a key category that tracks business investment rose after sliding in March -- a sign of health for American industry.
The Commerce Department says U.S. orders for durable goods -- manufactured items from washing machines to battleships that are meant to last at least three years -- fell 1.7 percent from March. The figure was pushed down by a 29 percent plunge in orders for civilian aircraft.
But transportation orders are volatile and bounce around from month to month. Without them, durable-goods orders rose 0.9 percent. Orders for computers, appliances and other electrical equipment and motor vehicles all rose.
"Business capital spending on key industrial equipment rose back in April to start the second quarter on a positive note," Chris Rupkey, chief financial economist at MUFG, wrote in a research note, adding: "The economy is firing on cylinders this quarter with both consumers and business investment adding to the mix on economic growth."
Orders for civilian capital goods excluding aircraft, a number that tracks business investment, rose 1 percent in April after dropping 0.9 percent in March.
U.S. industry is healthy, helped by an expanding world economy and robust spending by American consumers. But the outlook may be cloudier. The dollar has been rising, which should drive up the price of U.S. products in foreign markets. Manufacturers also face uncertainty surrounding the decision of President Donald Trump's administration to impose tariffs on imported steel and aluminum.
The Federal Reserve reported last week that U.S. factory production rose in April after a flat reading in March. A broader measure of industrial production, which includes mining and utilities, rose 0.7 percent.
Boeing Co., the Chicago-based aerospace company, said it got 78 orders for aircraft in April, down from 197 the previous month. Friday's government report showed that orders for civilian aircraft and parts fell 29 percent in April after surging 60.7 percent in March.
According to gross domestic product figures released in April, spending on business equipment rose at a 4.7 percent annualized pace in the first quarter, after surging 11.6 percent in the previous three months. It accounted for 5.8 percent of nominal GDP.
Information for this article was contributed by Shobhana Chandra of Bloomberg News.
Business on 05/26/2018