US factory orders beat expectations in July

New orders for US-manufactured goods increased more than expected in July, boosted by defense aircraft, but demand elsewhere was moderate amid higher borrowing costs.

Factory orders jumped 5.0 per cent after falling 3.3 per cent in June, the Commerce Department's Census Bureau said on Wednesday. Economists polled by Reuters had forecast factory orders rebounding 4.7 per cent.

Factory orders gained 0.4 per cent year-on-year in July. Defense aircraft and parts orders soared 12.9 per cent after declining 4.8 per cent in June. Excluding transportation, orders rose 0.4 per cent in July after gaining 0.1 per cent in the prior month.

The government also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment dipped 0.1 per cent in July as estimated last month.

Shipments of core capital goods decreased 0.3 per cent instead of 0.4 per cent as reported last month.

Nondefense capital goods orders rebounded 42.0 per cent, instead of 41.9 per cent as initially estimated.

Shipments of those goods increased 4.9 per cent, rather than 4.7 per cent as initially estimated. These shipments go into the calculation of the business spending on equipment component in the gross domestic product report.

Business investment in equipment notched double-digit growth in the second quarter despite higher interest rates.