Durable goods orders rose more than expected in May in the United States, driven in particular by the military aerospace sector, according to Commerce Department data released on Monday.
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0.7% increase in orders compared to April
Total orders amounted to $267.2 billion, up 0.7% from April. A welcome increase, commented analysts, while noting an overall slowdown. Analysts were expecting a much lower increase: +0.1%. Excluding the transport sector, orders increased in the same proportions (+0.7%), again above expectations (+0.4%). Last month, orders in civil aeronautics fell by 1.1%, but they were largely offset by those in the defense aeronautics sector (+8.1%). Orders for communication equipment recorded an increase of 2%.
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Rubeela Farooqi, chief economist for HFE, said the better-than-expected data surprised analysts. “However, since the beginning of the quarter, the momentum has slowed“, she tempers in a note. “Growth slows, but activity holds steady for nowsummed up Ian Shepherdson, chief economist at Pantheon Macroeconomics. Goods considered durable are those that have been used for three years or more, such as cars, appliances or electronics. The amounts are not adjusted for inflation, which rose in May to 8.6% over one year or 1% over one month. Buyers can thus buy fewer goods for the same amount.
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