Despite Durable Goods Orders' Fall, Some Manufacturing Strength
Most of the decline was due to a 29.6% drop off in civilian aircraft orders, which had soared 215% in April, according to MarketWatch. New orders excluding transportation increased 0.9%, the third gain in four months.
Though durable goods data can be volatile month to month, economists seemed to be viewing the latest figures as more proof that the economic recovery is taking hold, albeit weakly. The number of Americans filing for unemployment benefits for the first time fell 9,000 last week to a seasonally adjusted 457,000, the lowest level in six weeks. But at that level, the economy is not creating enough jobs to make a meaningful dent in the jobless rate.
"Profit growth has been very strong, and that's giving firms both the means and incentive to invest," Dean Maki, chief U.S. economist at Barclays Capital Inc. told Bloomberg News. Manufacturing "is really powering the recovery at this time."