Demand for aircraft, communications gear boost orders 3.3 percent in October, above forecasts.
November 26, 2003: 8:41 AM EST
WASHINGTON (Reuters) - New orders for long-lasting manufactured goods posted their biggest gain in 16 months in October, boosted by brisk demand for new aircraft and communications equipment, the government said Wednesday.
The report showed that business spending, which is crucial for the economic recovery, was gaining speed.
Orders for durable goods climbed 3.3 percent to a seasonally adjusted $184.53 billion, far ahead of Wall Street economists' forecasts for a 0.8 percent gain, while September's increase was revised up sharply to a 2.1 percent pickup, the Commerce Department said. Previously, the department said orders were up 1.1 percent in September.
The jump in October orders was the largest in more than a year, since an 8.1 percent surge in July 2002, and fit with other signs that businesses were picking up the pace on investment amid evidence the broader economy is strengthening.
Durables are goods intended to last three years or more, and the monthly measure is known for its volatility and is frequently revised.
On Tuesday, Commerce said gross domestic product, or GDP, shot ahead at an 8.2 percent annual rate in the third quarter, due in large part to stronger corporate and consumer spending.
Orders for communications equipment soared 25 percent in October to $10.02 billion after a 14.8 percent September increase. New orders for commercial aircraft rose 22 percent to $5.69 billion following a 5.1 percent decline in September.
Non-defense capital goods orders excluding aircraft, which many economists see as a gauge of business expansion plans, rose 1.7 percent to $59.09 billion in October after a 5.8 percent September increase.
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