U.S. Capital Goods Orders Climb More Than Previously Estimated

[Judi Lynn]

Source: Bloomberg

U.S. Capital Goods Orders Climb More Than Previously Estimated
By Bob Willis - Oct 4, 2010 9:00 AM CT

Orders for U.S. capital goods rose in August more than previously estimated, a sign companies are replacing outdated equipment. Total bookings dropped, pulled lower by a pullback in demand for aircraft.

Orders for non-military capital goods excluding planes increased 5.1 percent, the biggest gain since March and exceeding the 4.1 percent estimated last month, figures from the Commerce Department showed today in Washington. The 0.5 percent decrease in total bookings compared with a 0.4 percent drop projected by the median forecast of economists in a Bloomberg News survey.

Manufacturing will remain at the forefront of the recovery as companies use their large cash reserves to update equipment and cut costs. Federal Reserve Bank of New York President William Dudley last week said more monetary easing is probably needed to spur growth and avert deflation.

“Capital spending is clearly trending higher,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, said before the report. “You generally get a strong recovery in capital spending with a more noticeable improvement in hiring than what we’re seeing. It looks like the spring weakness was a temporary soft patch.”


Read more: http://www.bloomberg.com/news/2010-10-04/u-s-capital-goods-orders-climb-more-than-estimated-as-equipment-replaced.html

[Kolesar]

1. My employer makes those "capital" products and our stock is rising

...as a result of great income and earnings per share results.

(here come the 'pukes to unrec this thread)