WASHINGTON, March 18 (Reuters) – New orders for U.S. factory goods edged up in January as weakness in transportation equipment partially offset gains elsewhere, government data showed on Wednesday.
Factory orders rose 0.1% after an upwardly revised 0.4% drop in December, the Commerce Department’s Census Bureau said. The gain was in line with economists’ expectations. Orders were previously reported to have declined 0.7% in December. Orders increased 3.5% year-on-year in January.
The Census Bureau is still catching up on data releases following delays caused by last year’s government shutdown.
Manufacturing, which accounts for 10.1% of the economy, has been hammered by President Donald Trump’s sweeping tariffs, and factories face more cost pressures from the U.S.-Israeli war with Iran, which has sent oil prices surging by more than 40%.
Trump has defended the tariffs, which have been struck down by the U.S. Supreme Court, as necessary to protect domestic manufacturing, though about 100,000 factory jobs have been lost since January 2025.
Manufacturing could get a lift from increased oil and gas well drilling because of the higher prices, but economists said the investment boost would probably be insufficient to offset the drag from more expensive energy goods and could also take a while to filter through to the economy.
Factory goods orders were in January supported by increases in machinery and primary metals as well as demand for computers and electronic products, likely related to an artificial intelligence investment boom.
But orders for electrical equipment, appliances and components fell 0.6%, while those for transportation equipment dropped 0.8% as demand for defense aircraft and parts tumbled 23.8%.
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, ticked up 0.1% in January instead of being unchanged as was initially reported last week.
Shipments of these so-called core capital goods dipped 0.1% as previously reported. Business spending on equipment slowed in the fourth quarter, helping to curb gross domestic product growth to a 0.7% annualized rate. The economy grew at a 4.4% pace in the third quarter.
(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama )
