US durable-goods orders rise, business investment falls

A jump in commercial aircraft demand pushed orders for U.S. durable goods up sharply in February, the government reported Tuesday.The gain offset a sharp drop in orders that signal business investment plans, though economists viewed the decline as a temporary setback, noting that the broader trend in business investment remains favorable and should add to economic growth in the January-March quarter.The Commerce Department said overall orders for durable goods-expensive manufactured items expected to last at least three years-surged 5.7 percent in February, the biggest monthly increase in five months.The gain was driven by a rebound in volatile commercial-aircraft orders, which rose 95.3 percent following a 24 percent drop in January. Orders for motor vehicles and parts rose 3.8 percent, the best performance since July. Excluding transportation, durable-goods orders fell 0.5 percent.Orders for core capital goods-seen as a gauge of business investment-fell 2.7 percent in February. Demand weakened for machinery and communications equipment, but rose for computers. Still, the decline followed a 6.7 percent surge in January, which was the biggest one-month gain in almost three years. Before the February decline, the category had risen in three of the previous four months.Many economists were expecting a decline in capital-goods orders after January’s impressive gain. The broader trend has been positive, even with uncertainty about government tax and spending policies, they say.