U.S. durable-goods orders rose 5.6% in December but dipped excluding transport
The numbers: Orders for manufactured goods jumped 5.6% in December because of a flush of new contracts for Boeing passenger planes, but business investment was weak again in another sign of a corroding U.S. economy.
If transportation is set aside, new orders fell 0.1% last month. What’s more, a key measure of business investment also declined for the second time in four months. Economists polled by the Wall Street Journal had forecast a 2.4% increase in orders for durable goods. These are products like cars and computers meant to last at least three years.Big picture: By some measures, U.S. manufacturers are already in recession territory. They’ve reduced production in response to a slowdown in new orders and might make further cutbacks if the economy continues to soften.
Rising interest rates are a chief source of the recent weakness. Higher borrowing costs discourage consumers from spending and businesses from investing. Households have also shifted their spending more toward services such as recreation and away from goods like consumer electronics.Market reaction: The Dow Jones Industrial Average DJIA, +0.03% and S&P 500 SPX, -0.02% were set to open higher in Thursday trades.
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