WASHINGTON, Nov 3 (Reuters) – New orders for US factory goods increased more than expected in September, boosted by bookings for aircraft and a range of other goods, government data showed on Tuesday.
Factory orders rose 1.8% after an upwardly revised 0.3% gain in August, the Commerce Department’s Census Bureau said. Economists polled by Reuters had forecast orders surging 1.2% after a previously reported 0.1% gain in August.
Orders advanced 7.2% on a year-over-year basis in September.
An artificial intelligence infrastructure buildout and strong consumer spending are anchoring manufacturing, which accounts for about 9.4% of the economy.
But economists have cautioned that rising interest rates and declining inflation-adjusted household income would hamper manufacturing activity next year, especially the segments not exposed to the AI spending frenzy.
Though an Institute for Supply Management survey on Monday showed production at factories booming in October, sentiment among manufacturers continued to deteriorate, with pricing volatility, longer lead times, tariffs and the US-Israeli war with Iran cited as major drags.
Factory orders in September were driven by 28.3% jump in bookings for the volatile civilian aircraft and parts component. Orders for motor vehicle bodies, parts and trailers edged up 0.1%. Machinery orders soared 1.5%. Orders for computers and electronic products rose 0.8%, and vaulted 14.9% year over year.
Orders for electrical equipment, appliances and components fell 0.3%. The Census Bureau also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 0.6% in September instead of 0.5% as reported last month.
Shipments of these so-called core capital goods shot up 1.2% as initially estimated.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
