Helped by strong aircraft orders, durable goods orders in August rose by 1.8% on the month, easily beating analyst estimates of 0.7%, according to Commerce Department data released Monday.
The increase in new orders was even more remarkable as July’s reading was revised upward to an increase of 0.5% from a decline of 0.1%, making it the fourth straight monthly increase.
Capital goods orders increased by 6.7% on the month, driven mostly by aircraft orders; core capital goods orders—excluding aircraft and defense—rose more modestly at a rate of 0.5%, following an upwardly revised 0.3% in July.
Core capital goods shipments—the more closely watched series that feeds directly into the business investment calculation for gross domestic product—continued to post strong gains for the sixth consecutive month, increasing by 0.7% in August.
Shipments of vehicles and parts declined by 2.7% on the month, likely because of the supply shortages of semiconductors and workers.
These shortages also continued to affect unfilled orders, which had a 1.0% increase in August, lower than the headline number, as manufacturers scrambled to keep up with demand.
We expect that strong numbers for durable goods orders and shipments will remain an anchor point for GDP growth in the third quarter.