U.S. factory orders rebound in March; business spending on equipment strong
Reuters
Published May 04, 2021 10:39AM ET
WASHINGTON (Reuters) - New orders for U.S.-made goods rebounded in March and business spending on equipment was stronger than initially estimated, boosted by robust domestic demand, though momentum could slow because of bottlenecks in the supply chain.
The Commerce Department said on Tuesday that factory orders increased 1.1% in March after falling 0.5% in February.
Economists polled by Reuters had forecast factory orders rebounding 1.3%. Orders rose 6.6% on a year-on-year basis.
The White House's $1.9 trillion pandemic relief package and the expansion of the COVID-19 vaccination program to all adult Americans have led to a boom in demand, which is pushing against supply constraints.
The Institute for Supply Management reported on Monday that manufacturing activity grew at a slower pace in April, restrained by shortages of inputs. Robust consumer spending helped to lift gross domestic product growth at a 6.4% annualized rate in the first quarter, which followed a 4.3% growth pace in the final three months of 2020.
Most economists expect double-digit GDP growth this quarter, which would position the economy to achieve growth of at least 7%, which would be the fastest since 1984. The economy contracted 3.5% in 2020, its worst performance in 74 years.
Factory goods orders in March were boosted by strong demand for machinery, motor vehicles, fabricated and primary metal products. But orders for electrical equipment, appliances and components decreased. Unfilled orders at factories rose 0.4% after surging 0.9% in February.
The Commerce Department also reported that orders for non-defense capital goods, excluding aircraft, which are seen as a measure of business spending plans on equipment, jumped 1.2% in March instead of increasing 0.9% as reported last month.
Shipments of core capital goods, which are used to calculate business equipment spending in the GDP report, rose 1.6%. They were previously reported to have rebounded 1.3% in March. Business spending on equipment recorded a third straight quarter of double-digit growth in the first quarter.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.