US core capital goods orders fall unexpectedly in November

[WASHINGTON] New orders for US-made capital goods unexpectedly fell in November while shipments rose modestly, suggesting that shortages were hampering business spending on equipment.

Orders for non-defence capital goods excluding aircraft, a closely watched proxy for business spending plans, dipped 0.1 per cent last month, the Commerce Department said on Thursday (Dec 23). These so-called core capital goods orders shot up 0.9 per cent in October.

Economists polled by Reuters had forecast core capital goods orders rising 0.6 per cent.

Shipments of core capital goods gained 0.3 per cent last month after increasing 0.4 per cent in October. Core capital goods shipments are used to calculate equipment spending in measuring gross domestic product (GDP).

Business spending on equipment contracted in the third quarter after 4 straight quarters of double-digit growth. It was weighed down by a shortage of motor vehicles. A global shortage of semiconductors is hampering motor vehicle production.

Orders for durable goods, items ranging from toasters to aircraft that are meant to last 3 years or more, accelerated 2.5 per cent last month after edging up 0.1 per cent in October. They were boosted by a 6.5 per cent jump in orders for transportation equipment, which followed a 0.3 per cent drop in October. Motor vehicle orders increased 1.0 per cent after rebounding 5.8 per cent in October.

Orders for the volatile civilian aircraft category soared 34.1 per cent after falling 4.1 per cent in October. Boeing reported on its website that it had received 109 aircraft orders last month compared to only 10 in October.

REUTERS