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New orders for US factory goods fell in May amid a decline in bookings for commercial aircraft, but demand elsewhere remained strong, partly driven by investment in artificial intelligence.
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Factory orders dropped 1.3 percent after an upwardly revised 5.3 percent jump in April, the Commerce Department's Census Bureau said on Thursday. Economists polled by Reuters had forecast orders declining 1.8 percent after a previously reported 4.8 percent surge in April.
Orders increased 5.1 percent year-on-year in May. Manufacturing, which accounts for 9.4 percent of the economy, remains supported by the AI spending boom, which has limited the drag from the US-Israeli war with Iran.
An Institute for Supply Management survey on Wednesday showed manufacturing expanding for a sixth straight month in June. Commercial aircraft orders dropped 51.8 percent after soaring 167.4 percent in April. Boeing reported on its website that it had received 27 aircraft orders in May compared to 136 in April.
Orders for computers and electronic products rose 0.2 percent and were up 13.0 percent year-on-year. Machinery orders surged 2.1 percent. There were also big gains in orders for primary metals and fabricated metal products. Though orders for electrical equipment, appliances and components slipped 0.3 percent, they increased 6.2 percent year-on-year.
The Census Bureau also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, rebounded 1.4 percent in May instead of 1.6 percent as estimated last week. Shipments of these so-called core capital goods edged up 0.1 percent, instead of rising 0.3 percent as previously reported.
Reuters
