Washington, August 24--Demand for durable goods strengthened last month, underpinned by a surge in orders for non-defense aircraft and higher capital spending.
The Commerce Department said Wednesday orders for manufactured goods meant to last three years or more rose 1.7% to $195.6 billion in July, after a revised 1.1% gain in June. Economists had forecast a 1% increase in orders.
Orders for non-defense capital goods excluding aircraft, a barometer of business spending, climbed 0.6% after a 1.4% jump in June.
Transportation orders advanced by 5.6% in July after a 4.7% June advance. Non-defense aircraft orders doubled, while defense aircraft demand plummeted 38%. Orders for cars and parts fell 5.3%. Excluding transportation, durable goods orders edged up 0.1%.
Capital-goods orders rose by 5.7% after a 4.5% rise the prior month. There was a 16% decrease in demand for overall defense-related items. Orders for non-defense capital goods, or items meant to last at least 10 years, rose 9% after a 1.1% rise in June. Orders for computers and electronic products declined by 3.8% in July. Machinery orders rose by 2.1%.
Durable-goods inventories went up by 0.8%. Unfilled orders rose 1.2% and shipments inched up 0.1%.
