Factory orders rise, boosted by aircraft
WASHINGTON (Reuters) - New orders for factory goods rose in February but a gauge of planned business spending slipped, suggesting factory activity continued to expand at a modest pace.
The Commerce Department on Tuesday said orders for manufactured goods climbed 3.0 percent. Economists polled by Reuters had forecast orders advancing 2.9 percent.
Factory orders were boosted by the aircraft industry, which is prone to sharp swings. Civilian aircraft orders surged 95.1 percent. U.S. manufacturer Boeing had previously reported orders in February for 179 aircraft, up from two a month earlier.
Stock prices extended gains following the data's publication.
Gains in new orders were modest when stripping out more volatile categories. Orders excluding transportation equipment increased just 0.3 percent.
Data on Monday showed slowing growth of factory activity in March, suggesting the economy lost some momentum at the end of the first quarter as the effects of tighter fiscal policy started kicking in.
The factory orders data suggested some of the slowdown due to the fiscal restraint was present in February as well.
Orders for non-defense capital goods excluding aircraft - seen as a measure of business confidence and spending plans - declined 3.2 percent instead of the previously reported 2.7 percent drop.
However, this measure of core factory orders has also been quite volatile in recent months. In January, it rose 6.7 percent, the biggest gain since March 2010, according to revised readings.
Other data this year has shown little sign that higher taxes, and the $85 billion in across-the-board government spending cuts that took effect March 1 known as the "sequester," have weighed on economic activity.
The Commerce Department also said orders for durable goods, manufactured products expected to last three years or more, rose 5.6 percent instead of the 5.7 percent gain reported last week.