US factory orders beat expectations in August
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NEW orders for US-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 per cent after falling 2.1 per cent in July, the Commerce Department said on Wednesday (Oct 4). Economists polled by Reuters had forecast orders gaining 0.2 per cent. Orders rose 0.5 per cent on a year-on-year basis in August.
Manufacturing, which accounts for 11.1 per cent 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 per cent. Electrical equipment, appliances and components orders jumped 1.0 per cent. Machinery orders gained 0.6 per cent. Civilian aircraft orders fell 15.9 per cent, while motor vehicle orders rose 0.3 per cent.
Shipments of manufactured goods soared 1.3 per cent. Manufactured goods inventory rose 0.3 per cent, while unfilled orders increased 0.4 per cent.
The Commerce Department also reported that orders for non-defence capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 0.9 per cent as reported in last month’s estimate.
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Shipments of these so-called core capital goods rose by an unrevised 0.7 per cent. 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 per cent annualised rate. The economy grew at a 2.1 per cent pace in the April-June quarter. REUTERS
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