April durables orders weak, jobless claims rise

By David Lawder

WASHINGTON (Reuters) - New orders for U.S. durable goods rose by a weaker-than-expected 0.6 percent in April as volatile transportation orders fell, while initial claims for jobless benefits rose by 15,000 in the latest week, government reports showed on Thursday.

The tepid April increase for durable goods -- often costly manufactured items meant to last three years or more -- followed a sharp upward revision in the March figure to a gain of 5.0 percent from a previously reported figure of 3.7 percent, the Commerce Department said.

The April increase was well below the 1.0 percent rise in total durable goods orders forecast by Wall Street economists in a Reuters poll. The March figure was revised sharply upward to a 5.0 percent gain from a previously reported figure of 3.7 percent.

But some analysts said the data was consistent with recent trends in the economy and did not offer any strong signals to the Federal Reserve on whether to cut interest rates.

"Jobless are as expected, indicating similar conditions on the employment situation with fairly moderate growth and still working off the housing situation, said Robert Lutts, chief investment officer at Cabot Money Management in Salem, Massachusetts.

"Durables ex-transportation was a little more favorable and this will be where we will get earnings growth from. This is more of the same in the economy, a little stronger on the spending and investment side. I think the markets' take on this will be that it is similar to what we have had."

"I would say (the Federal Reserve) will continue to sit on their hands," he added

Orders for non-defense capital goods excluding aircraft, seen by economists as a proxy for business investment, rose 1.2 percent in April after a downwardly revised 4.4 percent increase in March. Analysts had predicted a 0.8 percent rise in this category.