New orders for U.S.-made capital goods increased more than expected in August and shipments maintained their upward trend, pointing to underlying strength in the economy despite an anticipated drag on growth from Hurricanes Harvey and Irma.
The Commerce Department said on Wednesday non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rose 0.9 percent last month after an upwardly revised 1.1 percent gain in July.
Economists polled by Reuters had forecast orders of these so-called core capital goods increasing 0.3 percent last month following a previously reported 1.0 percent jump in July. Core capital goods orders surged 3.3 percent year-on-year.
Shipments of core capital goods rose 0.7 percent after advancing 1.1 percent in July. Core capital goods shipments are used to calculate equipment spending in the government’s gross domestic product measurement.
The Commerce Department said it was unable to isolate the effects of Hurricanes Harvey and Irma on the data as the survey is “designed to estimate the month-to-month change in manufacturing activity at the national level and not at specific geographic areas.”
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