A gauge of planned U.S. business spending increased by the most in just over a year in January and new orders for long-lasting manufactured goods excluding transportation rose solidly, pointing to underlying strength in factory activity.
The Commerce Department said on Wednesday non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, jumped 6.3 percent, the biggest gain since December 2011, after slipping 0.3 percent in December.
Economists had expected this category to only rise 0.2 percent.
“The strong gains in core capital goods orders suggests that business investment activity, which has been one of the sour points of this economic recovery, could provide a meaningful lift to overall economic activity this quarter,” said Millan Mulraine, a senior economist at TD Securities in New York.
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