U.S. Durable Goods Orders Rise In March

By Agence France-Presse Soaring demand for warplanes powered a 2% surge in orders for big ticket items from U.S. factories in March, government figures showed April 24. But underlying figures also showed more orders for civilian capital goods, often an indicator of business investment plans. The monthly increase in orders, fired up by a 132.7% leap in orders for defense aircraft and parts, reversed a 1.5% decline in February, the seasonally adjusted data showed. Durable goods are items expected to last at least three years, such as washing machines, cars and planes. "The durable goods report today is good news for the beleaguered manufacturing industry," Arlington, Va.-based Manufacturers Alliance/MAPI chief economist Daniel Meckstroth said. "Clearly, the Iraq conflict explains the very large increase in March defense durable-goods orders." "The surprising news in the report is that nondefense orders rebounded quickly from a winter-storm-depressed February," he added. Orders for transport equipment rose 2.4% due largely to the leap in defense aircraft orders. Civilian aircraft and parts orders declined 12.6%. Motor vehicle and parts orders fell 1.1%. Capital-goods orders rose 3.9%, including a 1.8% increase in orders for nondefense capital goods, closely watched as a barometer of business plans to expand and modernize. Machinery orders climbed 2.3%. Computers and electronic products orders surged 4%. Electrical equipment orders rose 2.5%. "The rise in capital goods, computer equipment and software expenditures is very encouraging for the U.S. economy going forward as it indicates that business investment may be starting recover," said CDC IXIS Capital Markets economist Erik Norland. Copyright Agence France-Presse, 2003