U.S.-Made Durable Goods Orders In June Increased Unexpectedly

Washington, D.C. (AHN) - United States durable goods orders unexpectedly increased at the fastest pace for the second time this year in June after rising in February by 1.1 percent, according to a government report released on Thursday.

The upturn momentum to the new orders for U.S.-made capital goods in the month of June was aided by defence spending amid a slowdown in the global economy.

An additional rise came after an auto-industry strike ended. The strike had forced several plants closings across the country a few months ago, the report said.

General Motors said it returned to full production by June 16 after a strike ended at American Axle & Manufacturing Holdings Inc., the largest axle supplier to General Motors Corp.

According to the Commerce Department's report released on Friday, the increase was also led by orders for primary metals, machinery and electrical equipment

Orders for U.S.-built durable goods increased by 0.8 percent in June compared to an upward revision of 0.1 percent in May. It had slipped by as much as 4.4 percent in January.

Wall Street market analysts had projected that durable goods orders would decrease by about 0.3 percent during the last month.

Increase in the demand for big-ticket items in the U.S. came as a 1.4 percent rise in orders for non-defense capital goods excluding aircraft, a measure of future business investment.

Excluding the drop in transportation equipment orders, orders for durable goods increased by 2.0 percent in June following a 0.5 percent decline in May.

Machinery sales, which declined by a double-digit figure in February, dropping by 3.7 percent, went up by 2.3 percent during the last month. Transportation goods orders fell 2.6 percent after increasing by 1.9 percent.

While the Pentagon cut orders for military planes by 8.6 percent, there was also a drop in orders for commercial aircraft of a whopping 25.1 percent.

Primary metals orders surged by 5.1 percent in June after slipping by 1.8 percent in May and shipments increased by 2.8 percent after falling 1.4 percent.