Partly reflecting a rebound in orders for transportation equipment, the Commerce Department released a report on Tuesday showing a notable increase in new orders for U.S. manufactured durable goods in the month of February.
The report said durable goods orders jumped by 1.4 percent in February after plummeting by a revised 6.9 percent in January.
Economists had expected durable goods orders to shoot up by 1.3 percent compared to the 6.2 percent slump that had been reported for the previous month.
“The report gives support to the argument that weather disruptions and seasonal adjustment issues rendered January data unrepresentative of underlying trends,” said FHN Financial Economic Analyst Mark Streiber and FHN Financial Macro Strategist Will Compernolle.
They added, “Considering the high amount of recent data noise, we do not expect this release to change the market’s or Fed’s understanding of the overall economic narrative.”
Orders for transportation equipment led the way higher, surging by 3.3 percent in February after plunging by 18.3 percent in January.
The rebound came as orders for non-defense aircraft and parts soared by 24.6 percent in February following a 63.5 percent nosedive in January.
Excluding the rebound in orders for transportation equipment, durable goods orders climbed by 0.5 percent in February after falling by 0.3 percent in January. Economists had expected a 0.4 percent increase.
Sharp increases in orders for machinery and primary metals helped offset notable decreases in orders for electrical equipment, appliances and components and computers and electronic products.
The report also said orders for non-defense capital goods excluding aircraft, a key indicator of business spending, climbed by 0.7 percent in February after falling by 0.4 percent in January.
Meanwhile, shipments in the same category, which is the source data for equipment investment in GDP, fell by 0.4 percent in February after advancing by 0.8 percent in January.
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