Orders for durable goods rose 0.9% in February, well above economists’ expectations for a 1% decline in the month.
Meanwhile, core capital goods orders fell 0.3% in February, below the 0.2% expected, while shipments of capital goods increased 0.9%, higher than the 0.2% economists had expected.
The metrics are closely watched, as they feed into the Gross Domestic Product (GDP). But following Wednesday’s release, economists at Goldman Sachs wrote that they left their first quarter GDP forecast of 1.3% annualized growth for the US economy “unchanged.”
Renaissance Macro head of economics Neil Dutta described the durable goods release as “welcome” but questioned whether the increase will last, as uncertainty around President Trump’s policies has weighed on sentiment among businesses.
“Between slower growth to begin the year with rising uncertainty to kick-off the administration’s economic policy agenda, business investment intentions have cooled off,” Dutta wrote. “In short, I would not expect this capex recovery to last.”