U.S. Durable Goods Orders Up 0.3%

Machinery orders increase 6%

In a sign of steady growth in the industrial sector of the economy, orders for big-ticket manufactured goods in December rose 0.3%, the Commerce Department reported on Jan. 28.

The report showed new orders for durable goods -- including planes, cars, appliances and other items expected to last three years or more -- rose to $167.9 billion.

It followed a revised a 0.4% decrease in November.

Excluding transportation -- which can be heavily skewed by aircraft demand -- new orders increased 0.9%. Excluding defense, new orders rose 0.3%.

The December rise was led by machinery orders, up 6%.

Civilian aircraft orders pulled down the headline number with a 38.2% drop while orders for computers and electronics fell 3%.

Over the full year 2009, orders fell 20.2%, which is the worst since the data series began in 1992.

" The December report indicates that an inventory swing is pushing up orders for materials (from steel to semiconductors) and the resulting increase in production activity in the manufacturing sector is having a positive impact on business equipment spending," said Daniel J. Meckstroth, Chief Economist for the Manufacturers Alliance/MAPI.

"After a long, steep decline in industrial activity that bottomed out in June, some pent up demand for equipment repair and replacement is emerging," he added. "The outlook for 2010 is for moderate production growth with the large majority of manufacturing industries posting some growth. Today's durable goods report is consistent with the outlook of a sector regaining its footing again."

Copyright Agence France-Presse, 2010

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