The Economy

Core Capital Goods Orders Up Again In July

The 2.2% increase is the biggest since June 2014 and may help convince the Fed to go ahead with an interest rate hike this year.
Katie Kuehner-HebertAugust 26, 2015
Core Capital Goods Orders Up Again In July

A closely watched proxy for business spending plans rose 2.2% in July, its biggest increase since June 2014, the U.S. Commerce Department said Wednesday, bolstering analysts’ expectations that the U.S. economy can withstand global strains.

The increase last month in non-defense capital goods orders excluding aircraft followed an upwardly revised 1.4% increase in June. Economists had forecast only a 0.4% increase in July after a previously reported 0.9% increase in June.

“The economy had a tailwind heading into the recent market rout,” Mesirow Financial’s chief economist Diane Swonk told Reuters. “That tailwind will help to carry us through the turbulent waters that lie ahead.”

Drive Business Strategy and Growth

Drive Business Strategy and Growth

Learn how NetSuite Financial Management allows you to quickly and easily model what-if scenarios and generate reports.

July’s figures for core capital goods orders should bolster the prospects of economic growth in the third quarter, TD Securities’ deputy chief economist Millan Mulraine said.

“It points to a sharp acceleration in the pace of business capital investment activity in the third quarter and provides some upside risks to our expectation for growth,” Mulraine explained.

The capital goods report and other recent data on employment, industrial production, retail sales, housing, and consumer spending data highlight the U.S. economy’s resilience, boosting analysts’ expectations that the Federal Reserve could still raise interest rates this year despite a global markets sell-off. Pokies with the withdrawal of money in the bank card have every other online casino. You need to choose a few of the best payment options and compare the returns of pokies . More often than not, players get excellent access to 100+ pokies.

New York Fed President William Dudley said on Wednesday that a September rate hike “seems less compelling to me than it was a few weeks ago.”

Overall orders for durable goods rose 2% in July, led by a 4.7% increase in transportation equipment, the Commerce Department said. Transportation was lifted by a 4% rise in orders for automobiles and parts, as automakers kept most assembly lines running during the summer instead of shutting them down for retooling. That increase offset a 6% decline in aircraft orders.

Unfilled orders for durable goods rose 0.2% in July, the largest gain since November, while inventories were unchanged.