The U.S. economy built more momentum in July, as the as the Department of Commerce reported an increase in durable goods orders, adding to June’s gains.
Tuesday the department released its advance report, which showed that new orders for manufactured goods increase by $55.3 billion, or 22.6%, to $300.1 billion last month, following June’s revised 2.7% rise.
“This increase, up five of the last six months, was at the highest level since the series was first published on a NAICS basis in 1992…” the report said.
According to consensus estimates, compiled by media organizations, economists were expecting durable goods to rise between 7.0% and 8.0%, as a result of increased orders for airplanes from Boeing.
Andrew Grantham, senior economist at CIBC World markets, said that although durable goods data was three times higher than expected, the increase does not come as a major surprise.
“Record aircraft sales were always expected to see headline durable orders soar in July, the only question was how high,” he said.
Paul Dales, senior U.S. economist said that aircraft orders increased more than 300%; however he added that this won’t impact the nation’s economic activity because “GDP measures output produced rather than orders received.”
“This won’t boost GDP until those orders are completed late this decade,” he added.