WASHINGTON, Jan 26 (Reuters) – New orders for key U.S.-manufactured capital goods increased more than expected in November, suggesting business spending on equipment maintained a steady growth pace in the fourth quarter.
Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, rose 0.7% after a downwardly revised 0.3% gain in October, the Commerce Department’s Census Bureau said on Monday.
Economists polled by Reuters had forecast these so-called core capital goods orders increasing 0.3% after a previously reported 0.5% advance in October. Shipments of core capital goods rose 0.4% after gaining 0.8% in October.
The report, which was delayed by the 43-day shutdown of the federal government, followed on the heels of data last week showing strong consumer spending in October and November. The Atlanta Federal Reserve is forecasting gross domestic product increased at a 5.4% annualized rate in the fourth quarter.
The economy grew at a 4.4% pace in the July-September quarter, boosted by consumer spending and a smaller trade deficit. Business investment in equipment also contributed to the fastest economic growth pace in three years.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)