Skip to main content
Advertising

Originally published Wednesday, September 3, 2014 at 11:36 AM

  • Share:
             
  • Comments
  • Print

US factory orders up record 10.5 percent in July

Business orders for U.S. factory goods shot up by a record amount in July, reflecting a surge in demand in the volatile category of commercial aircraft.


AP Economics Writer

advertising

WASHINGTON —

Business orders for U.S. factory goods shot up by a record amount in July, reflecting a surge in demand in the volatile category of commercial aircraft.

But outside of transportation, orders actually fell slightly during the month although the setback was expected to be temporary.

Factory orders rose 10.5 percent in July, the biggest one-month increase on records going back to 1992, the Commerce Department reported Wednesday. Orders for civilian jetliners rose four-fold. But excluding transportation, orders edged down 0.8 percent and a key category that serves as a proxy for business investment plans fell 0.7 percent.

Manufacturing has been a source of strength this year, helped by robust demand for new cars, other consumer items and business equipment. Economists expect that strength to continue.

The report showed that durable goods, items expected to last at least three years, were up 22.6 percent in July, unchanged from the estimate in a preliminary report last week. Orders for nondurable goods such as paper, chemicals and food were down 0.9 percent in July after a 0.4 percent increase in June.

In addition to the surge in demand for airplanes, orders for motor vehicles and parts rose 7.3 percent, reflecting continued strong consumer demand for new cars and trucks.

But there was slippage in other areas. Orders for primary metals such as steel fell 0.3 percent, demand for machinery was down 1.2 percent and orders for computers and other electronics products fell 14.7 percent.

Despite this weakness, most economists expect that manufacturing production will provide solid support for economic growth in the second half of this year.

While a key category viewed as a proxy for business investment plans dropped 0.5 percent in July, the dip followed a sizable 5.4 percent increase in June. The government reported last month that investment by businesses in new equipment grew at a solid 10.7 percent annual rate in the April-June period, erasing a decline in the first three months of the year.

Factory output rose for a sixth consecutive month in July, increasing by 1 percent. The gain was led by a jump in production of motor vehicles, furniture, textiles and metals.

In a sign that momentum in manufacturing was continuing, the Institute for Supply Management reported Tuesday that its gauge of manufacturing activity grew in August by the strongest pace in more than three years as factories cranked out more goods and new orders rose.

The index rose to 59 from 57.1 in July. That was the highest reading since March 2011. Any measure above 50 signals that manufacturing is growing.

One potential threat to the optimistic outlook for U.S. manufacturing is a slowdown overseas. Turmoil in Ukraine, the lingering problems from Europe's debt crisis and slower growth in China could all weigh on U.S. exports to key overseas markets.



Want unlimited access to seattletimes.com? Subscribe now!

Also in Business & Technology

News where, when and how you want it

Email Icon

Bake cookies for a cause

Bake cookies for a cause

Get 23 scrumptious recipes in our "Quintessential Cookies" e-book. One dollar of your $3.95 purchase goes to Fund For The Needy.

Advertising

Advertising

The Seattle Times photographs

Seattle space needle and mountains

Purchase The Seattle Times images


Advertising
The Seattle Times

The door is closed, but it's not locked.

Take a minute to subscribe and continue to enjoy The Seattle Times for as little as 99 cents a week.

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Subscriber login ►
The Seattle Times

To keep reading, you need a subscription upgrade.

We hope you have enjoyed your complimentary access. For unlimited seattletimes.com access, please upgrade your digital subscription.

Call customer service at 1.800.542.0820 for assistance with your upgrade or questions about your subscriber status.

The Seattle Times

To keep reading, you need a subscription.

We hope you have enjoyed your complimentary access. Subscribe now for unlimited access!

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Activate Subscriber Account ►