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Durable goods drop

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Durable goods drop

But business spending rebounds during May.

New orders for manufactured durable goods in May decreased 1.8%, the U.S. Census Bureau announced today. The decrease was largely due to a dearth of orders for transportation equipment.

Analysts had expected a decrease of 1.0%.

However, non-defense capital goods orders excluding aircraft - so-call “core capital goods orders -  increased 0.4% during the month, following a revised 0.3% decrease in April.

Analysts had estimated an increase in core capital goods orders of 0.5%. 

The increase in core capital goods orders is particularly encouraging, as it is generally considered a solid gauge of business spending.  Given the relative weakness of first quarter growth and the fairly tepid economic data for the second quarter so far, it may provide more optimism for growth going forward.   

 

 

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