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Orders for U.S. manufactured goods rose 2.2% in April, the Commerce Department said Tuesday.
The gain was much stronger than expected. Economists surveyed by the Wall Street Journal were expecting a 1% increase.
The factory sector has been a bright spot during the pandemic and its aftermath. Factory orders have risen in 22 of the past 23 months.
Josh Shapiro, chief U.S. economist at MFR Inc, noted that the government reports the data in nominal terms and doesn’t account for inflation.
This is fine with monthly prints of inflation are 0.1% but not when the gains are closer to 1%, he said.
With inflation so high now, the nominal data “overstates what’s going on,” he said.
Durable-goods orders rose a revised 1.1% in March, revised from the initial estimate of a 0.8% gain. Durable goods orders are up in five of the past 6 months. Orders for non-durable goods jumped 3.2 % in the month. Shapiro said he thought the gain was largely due to higher oil prices.
A key indicator of business investment, orders for non-defense capital goods, excluding aircraft, rose a revised 1.3% in March, up from the prior reading of a 1% gain .
U.S. stocks
DJIA,
SPX,
were higher in morning trading on Tuesday as the Federal Reserve’s two-day policy meeting got underway.
