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US durable goods orders rebound in July
[WASHINGTON] US manufacturing showed strength in July as durable goods orders rebounded from two straight fall, the Commerce Department reported on Thursday.
Total new orders for manufactured goods with long lifetimes added 4.4 per cent to US$228.9 billion.
New orders for defense equipment were up 35.7 per cent, machinery 1.6 per cent, and computers and electronic products 3.6 per cent. The automobile sector was flat.
While the main reason for the turnaround was a rebound in civilian aircraft orders - a large but volatile part of the total each month - orders for durable goods excluding the dominant transportation sector were also higher by 1.5 per cent.
That demonstrated that capital spending by companies is turning around after a sharp downturn dating back to last year, as the energy industry sharply cut back due to the plunge in oil prices, said Ian Shepherdson of Pantheon Macroeconomics.
"The key number in this report is the 1.6 per cent increase in orders for non-defense, non-aircraft capital equipment, the biggest gain since January; we expected a 1.0 per cent gain," he said in a client note.
For the year to date, durable goods orders were down 0.9 per cent from last year, reflecting both the oil industry crunch and the impact on exports of the strong dollar.