WASHINGTON—Orders for long-lasting manufactured goods rose in
June, snapping a two-month streak of declines and suggesting
greater confidence among businesses.
New orders for durable goods—products such as toaster ovens and
aircraft carriers designed to last at least three years—rose a
seasonally adjusted 3.4% in June from a month earlier, the Commerce
Department said Monday. May durable goods orders fell a revised
2.1% compared with the previously reported 2.2% decrease.
Economists surveyed by The Wall Street Journal had expected
overall orders to rise 2.7%.
Durable goods statistics are volatile and subject to large
revisions. Still, other recent data indicate the manufacturing
sector is improving as the economy shores up.
June's increase in part reflects a surge in aircraft demand, a
heavyweight component of the report that often swings dramatically
from month to month. Orders for nondefense aircraft and parts were
up 66.1% in June. Separately, Boeing Co. said it received 161
orders for planes in June, up from 11 in May.
Excluding the transportation sector, orders rose 0.8%. That was
the largest increase since August 2014.
Excluding defense — another volatile sector — orders rose
3.8%.
A key measure of business investment also rose in June. Orders
for nondefense capital goods excluding aircraft, which is
considered a proxy for business spending on equipment and software,
climbed 0.9%, following a 0.4% decrease in May.
Monday's report adds to indications that U.S. manufacturers may
be overcoming challenges from a strong dollar, harsh winter weather
and a drop in the price of oil, which has depressed spending on
mining and oil and gas machinery. In the first half of 2015, new
orders are down 2% compared with the same period a year
earlier.
Industrial production, a measure of output in the manufacturing,
utilities and mining sectors, rose a seasonally adjusted 0.3% in
June, according to a revised Federal Reserve report released
earlier this month.
And a survey of supply-chain executives conducted by the
Institute for Supply Management found renewed optimism among
purchasing managers.
The Commerce Department is set to release its first reading of
second-quarter economic growth Thursday, which will include
estimates of business spending's impact on gross domestic product.
Real nonresidential fixed investment dropped at a 2% annual rate in
the first quarter. That contributed to the annualized 0.2%
contraction in GDP recorded in the first quarter of the year,
according to the Commerce Department.
Economists expect the second quarter reading to recover.
Employers have continued to add jobs and the unemployment rate has
fallen to 5.3%. But sluggish retail spending suggests that
consumers remain wary.
Write to Eric Morath at eric.morath@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires