New orders for U.S.-made goods recorded their biggest increase in nearly a year in August, boosted by a surge in demand for aircraft, but signs of weakness in business spending on equipment suggested that the manufacturing sector could be slowing.
Factory goods orders surged 2.3 percent, the largest increase since September 2017, the Commerce Department said on Thursday. Data for July was revised up to show factory orders falling 0.5 percent instead of the previously reported 0.8 percent drop.
Economists polled by Reuters had forecast factory orders rebounding 2.1 percent in August. Orders increased 8.6 percent on a year-on-year basis in August.
Manufacturing, which accounts for about 12 percent of the U.S. economy, is being supported by robust domestic demand, but momentum is expected to gradually slow amid worker shortages, an increasingly bitter trade war between the United States and China, a strong dollar and moderating global growth.
An Institute for Supply Management survey of manufacturers published on Tuesday showed factory activity retreated from a 14-year high in September.