U.S. Durable Goods Orders Expand Faster Than Expected in October
(Bloomberg) -- U.S. durable goods orders increased at a faster-than-expected clip in October, supported by demand for computers and metals, underscoring a manufacturing sector that continues to support the economy.
Bookings for durable goods -- items meant to last at least three years -- increased 1.3% from the prior month, according to a Commerce Department report Wednesday that exceeded estimates in a Bloomberg survey that had called for a 0.8% rise. The September reading was revised up to a 2.1% increase.
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Shipments of core capital goods, which help form estimates for a portion of U.S. gross domestic product, climbed 2.3% from the prior month, the strongest reading since July and above all forecasts.
The results add to other recent manufacturing data that signals the sector is recovering at a healthy pace from the coronavirus lockdowns and an earlier drop in demand. At the same time, as infections soar across the country, recent momentum may face new constraints.
Meanwhile, core capital goods orders, which are used as a proxy for business investment and excludes aircraft and military goods, climbed 0.7% and also exceeded estimates following an unpwardly revised 1.9% advance in September.
The report indicated a pickup in orders for fabricated metal products, which saw a second straight 2.3% increase, as well as for electrical equipment and transportation equipment. Orders for machinery and nondefense capital goods both fell slightly, while bookings for motor vehicles and parts dropped 3.2%.
Other data have been positive: Manufacturing output continued to strengthen in October, Federal Reserve data show. And November also saw improvement, with U.S. factory activity expanding by the most since Sept. 2014 amid a rise in output, according to IHS Markit.
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