By Alice Seeley
Orders at U.S. factories for durable goods meant to last at least three years, such as computers and cars, rose by 0.8% to a seasonally adjusted $275 billion in March, the Commerce Department reported on April 26. This increase matched the estimate by economists polled by the Wall Street Journal.
The rise comes after a 1.7% decline in February. The report stated that “computers and electronic products, up two of the last three months, led the increase.” The value of core capital goods orders, which excludes aircraft and military hardware, rose by 1% to $80.8 billion in March compared with the previous month. In addition, passenger planes and autos orders jumped 2.4% in March.
Strong consumer demand and limited inventories increased manufacturing demand, but supply-chain issues constrained production and increased prices. The war in Ukraine, economic sanctions on Russia, and the increase of COVID cases in China also contributed to supply-chain disruptions.
This means that business investment is rebounding after the first decline in a year, which is a good sign that the economy is still growing steadily.
“The solid increase in core orders suggests that businesses remain in good shape and are still looking to bulk up their machines and equipment to contribute to their bottom lines,” said Senior Economist at BMO Capital Markets Jennifer Lee.