US factory orders rise unexpectedly in January

US factory orders unexpectedly rose 0

US factory orders unexpectedly rose 0.2 per cent in January on electrical equipment strength while a gauge of business spending also posted solid gains, a government report showed today.

The rise in factory orders to a seasonally adjusted $380.53 billion defied Wall Street expectations for a 0.1 per cent drop. The Commerce Department also revised up December's factory orders to a 0.5 percent rise from an originally reported 0.3 per cent gain.

Meanwhile, January orders for durable goods - those intended to last for three years or more - were revised to a 1.3 per cent fall from a smaller 0.9 per cent decline.

Non-defense capital goods excluding aircraft, seen by economists as a measure of business spending strength, rose 2.9 per cent in January after an upwardly revised 3.4 percent climb in December.

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Transportation orders, the largest single component in factory business, fell 5.4 percent in the month after a 2.3 percent decline in December.

The weakness was offset by a 12.3 percent jump in orders for electrical equipment, appliances and components - the sector's largest advance since September 1997.

Excluding transportation, factory orders rose 1.1 per cent in January. Total inventories jumped a record 1.3 per cent in January while durable goods inventories also rose a record 1.2 per cent. The inventories-to-shipments ratio was unchanged at 1.23 in January.