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Durable goods orders surged more than forecast in October,
according to a report from the Commerce Department released on
Wednesday.
Orders for things built to last such as appliances rose
4.8% (1.7% forecast.) Total orders were lifted by a
near-100% month-on-month increase in orders for commercial
aircraft; Boeing said it got 85 orders for planes in October.
Orders for computers and related products were also strong during
the month.
Excluding transportation equipment, which clearly can be quite
volatile, core durable goods orders rose 1% (0.2% expected.)
Capital goods orders for nondefense items excluding aircraft — an
important gauge of business spending — increased by
0.4% (0.3% expected.) This is a closely watched metric
in the report because it provides clues about corporate America's
spending plans.
Business spending has contracted every quarter since the final
three months of 2015, partly because of the weakness in oil
prices and energy-related sectors.
"Today's durable goods report covers the month of October, and
we are more interested in the possible shift in order flow
that could result from a post-US Election improvement in
business sentiment," said Joseph LaVorgna, the chief US economist
at Deutsche Bank, in a note. "Hence, in our view, next
month's durable goods data are of greater significance."
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