Orders of big-ticket manufactured items defied expectations to rise again in April, fueled by a sharp rise in orders for defense aircraft, according to U.S. government data released Friday.
Manufactured durable goods rose by 1.1% in April from a month earlier to $283.0 billion, the Commerce Department announced in a statement.
April's figure built on a revised monthly increase of 3.3% in March and was far stronger than the median forecast of a 0.8% decline in a MarketWatch survey of economists.
The largest factor behind the surprise rise in durable goods orders was defense spending, with new orders of defense aircraft and parts increasing by almost a third from a month earlier.
Orders for transportation equipment also increased, while those for nondefense aircraft and computers posted monthly declines.
While the April data for durable goods orders was better than expected, downside risks remain going forward "given the hurdles companies are facing not only from higher borrowing costs, but also a further tightening in credit conditions going forward," High Frequency Economics chief U.S. economist Rubeela Farooqi wrote in a note to clients.
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