WASHINGTON (Reuters) - New orders for U.S. factory goods rebounded in February and firms increased orders for capital goods, suggesting manufacturing held on to some momentum early in the year.
The Commerce Department said on Tuesday new orders for manufactured goods rose 1.3 percent, just below the 1.5 percent gain expected by private forecasters in a Reuters poll.
Growth in the U.S. economy likely slowed in the first quarter as weaker restocking of companies’ shelves kept factories less busy.
Also weighing on factories, many economists think the expiration of some tax breaks on capital spending at the end of 2011 led businesses to bring forward investments.
Indeed, January’s decline was revised downward to 1.1 percent from a previously reported fall of 1 percent.
But February’s gain was nearly as high as the 1.4 percent rise in orders in December. Factory orders have now risen in three of the last four months.
New orders for durable goods - long lasting products from toasters to airplanes - rose 2.4 percent in February. That was higher than the government’s initial estimate of a 2.2 percent increase.
U.S. stocks opened marginally higher, while government debt prices rose. Financial markets were awaiting release of minutes from the Federal Reserve’s policy meeting last month. The dollar rose against the yen, but was little changed versus the euro.
Orders for non-defense capital goods excluding aircraft - a closely watched category because it is taken as a sign of businesses’ future spending plans - rose 1.7 percent in February. That was a bigger increase than 1.2 percent gain reported in a preliminary estimate.
Shipments for this category climbed 1.4 percent.
Business spending and manufacturing have been drivers of the recovery since the 2007-2009 recession.
Reporting by Jason Lange; Editing by Neil Stempleman