Economy Watch: Durable Goods Another Positive for the Economy
Indicators for the U.S. economy in March have so far been coming in mixed, but on Thursday there was one more for the positive side of the ledger: durable goods orders were up 2.6 percent for the month, according to the Census Bureau.
By Dees Stribling, Contributing Editor
Indicators for the U.S. economy in March have so far been coming in mixed, but on Thursday there was one more for the positive side of the ledger: durable goods orders were up 2.6 percent for the month, according to the Census Bureau. That followed a previous expansion of 2.1 percent in February.
Moreover, the expansion was fairly broad-based. Taking transportation equipment out of the equation—most of it airplanes, which tend to gyrate from month to month —and new U.S. durable goods orders were up 2 percent. Take spending for durable defense goods out of the equation and new orders still had a reasonably healthy month-over-month increase, 1.8 percent. Transportation equipment did, however, lead the increase for the month, rising 1.5 percent for the month.
The positive durable goods report, which comes after a reasonably strong jobs numbers but disappointing housing growth, might help tip the balance in favor of the Federal Reserve continuing to taper its bond-buying program again by $10 billion next month, as it has done since the beginning of 2014. The Federal Open Market Committee will meet next week to discuss tapering, as well as unlikely possibility of raising benchmark interest rates.
Initial unemployment claims rise
For the week ending April 19, initial unemployment claims came in at an annualized 329,000, an increase of 24,000 from the previous week, which had been revised up by 1,000 from 304,000 to 305,000. Though something of a spike, there seemed to be no special factor driving the rate, which has been unusually low in recent weeks.
The less jumpy four-week moving average of initial unemployment claims also jumped a bit. For the week ending April 19, the rate was an annualized 316,750, an increase of 4,750 from the previous week’s unrevised average of 312,000.
Wall Street bounced back again on Thursday, perhaps because of the durable goods news, though unusually, the Dow Jones Industrial Average ended the trading day back where it started, breaking even for the day. Still, the S&P 500 advanced 0.17 percent and the Nasdaq was up 0.52 percent.