Official figures show that new orders for long-lasting US manufactured goods excluding transport rose in August and business spending rebounded strongly, pointing to an improvement in the economy after a recent weak patch.
Orders excluding transport rose 2% after falling by 2.8% in July, the Commerce Department said. That was the largest increase since March and beat market expectations for a 1% gain.
But overall orders dropped 1.3%, the largest decline in a year, after a 0.7% increase in July. Markets had expected orders to fall 1%.
Data for August such as private sector employment, retail sales and home sales have suggested an easing of the harsh conditions that gripped the economy in the second quarter, calming fears the economy could slide back into recession.
But domestic demand remains lacklustre and the Federal Reserve this week said it was prepared to pump more money into the economy if needed to stimulate the recovery and avert a damaging downward spiral in prices.
Last month, non-defence capital goods orders excluding aircraft - a closely watched indicator of business spending - rebounded 4.1% in August after a 5.3% drop in July. Markets had expected a 2% rise.
Durable goods orders are a leading indicator of manufacturing, a sector which is leading the economy's recovery from the longest and deepest recession since the Great Depression as businesses replenish inventories. But manufacturing is slowing as domestic demand remains weak, with households grappling with high unemployment and falling wealth.
The decline in overall orders last month reflected a 40.2% plunge in non-military aircraft orders after a 69.1% surge in July. Boeing received only 10 orders for civilian aircraft in August, a sharp slowdown from 130 bookings in July, according to information posted on the plane maker's website. Orders were also weighed down by bookings for military aircraft, which fell 2.7%.
