Defence sector boosts US durable goods orders in August

US durable goods orders grew unexpectedly in August, as a jump in orders from the defence sector more than offset falling demand for airplanes and automobiles.

Orders for goods made to last for more than three years, rose at a month-on-month pace of 0.2% in August to reach $250.67bn (consensus: -1.2%), the Department of Commerce said.

Defence aircraft and parts were especially strong, registering another monthly gain of over 30% to hit $4.56bn.

The biggest declines meanwhile were seen in orders for non-defence aircraft and parts and automobiles, with declines of 17.1% and 0.8%, respectively.

Falling orders for communications equipment were also seen last month, albeit alongside increases in those for primary metals, fabricated metal products and for computers and related products.

Nonetheless, in comparison to a year ago, total durable goods orders fell by 0.4%.

And a key lead indicator, orders for capital goods excluding defence and aircraft dipped by 0.2% on the month and were just 1.1% higher on the year.