(Bloomberg) -- Orders placed with U.S. factories for business equipment accelerated by more than forecast in July, a sign solid demand extended into the second half despite corporate concerns over tariffs, Commerce Department figures showed Friday.
Highlights of Durable Goods (July) |
|---|
|
Key Takeaways
Orders rose for machinery, computers and electronic products and motor vehicles and parts last month, according to the report. The data, representing the first results since the U.S. and China imposed tariffs on each other's goods in early July, signal that business investment remains intact even as President Donald Trump widens a trade war to a growing range of products from China.
Growth in business spending, which is getting a boost from lower corporate taxes, is one of the factors supporting economic growth that could reach 3 percent in the second half. Even so, the uncertainty over trade may spur companies to slow investment. The next round of proposed actions by the Trump administration against Chinese imports would place tariffs of as much as 25 percent on $200 billion in goods.
The drop in overall durable-goods orders reflects bookings for aircraft and parts, typically a volatile category. Civilian airplane orders fell 35.4 percent in July, while the military side dropped 34.6 percent. Boeing Co. previously reported that the planemaker received 30 orders in July, down from 233 in June.
The strength in business-equipment demand helped boost some estimates for third-quarter growth in gross domestic product. Barclays Plc analysts increased their tracking estimate to a 3.2 percent annualized rate from 3 percent, while Stephen Stanley of Amherst Pierpont Securities raised his projection by 0.2 percentage point to 3.5 percent. The economy expanded at a 4.1 percent pace in the second quarter, the fastest since 2014.
What Our Economists SayOther Details©2018 Bloomberg L.P. Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit. News for You
Hello Reader
Sign In / Register
Set as Trusted Source
on Google Search
|
