Commerce Department Data Shows Biggest Order Increase In Nine Months
According to the latest Commerce Department data, US factory orders in July increased by 1.9%, the biggest gain in nine months and the largest one-month gain since October 2015. The AP reported that the increase was “propelled by a big jump in demand for commercial aircraft.” Demand for oil field equipment jumped by 45.6 percent in July, the third month in a row of “strong gains.” The AP adds that economists “are hoping that” business investment “will begin to rebound in the second half of this year.” Orders for durable goods “rose 4.4 percent in July, the same as the estimate the government made in an advance report,” while orders for nondurable goods “dropped 0.5 percent in July after rising 0.8 percent in June.” Reuters also reported, saying July orders for transportation equipment “surged 10.6 percent,” motor vehicles and parts “slipped 0.5 percent,” machinery “jumped 1.4 percent,” electrical equipment, appliances and components “soared 3.7 percent,” and computers and electronic products “rose 3.4 percent.” Business Insider said the increase was “roughly in line with expectations,” as economists “had expected a gain of 2%, according to Bloomberg.”
What This Means For Small Businesses
News of a rebound in US factory orders for July is a signal that some activity has returned to the US manufacturing sector. However, problems continue for the sector, as Labor Secretary Thomas Perez recently noted. Reuters reported that Perez warned that weak global expansion and a strong US dollar “were hurting the factory sector.” Small businesses in the manufacturing sector in particular have been feeling the negative effects of a weak global economy.
MarketWatch also covered the latest Commerce Department factory orders data.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.