US factory orders edge up in April

Corey Reid loads Series 6 solar panels into the manufacturing line during a tour of a First Solar factory in Walbridge, Ohio, U.S., October 6, 2021. REUTERS/Dane Rhys

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WASHINGTON, June 2 (Reuters) – New orders for U.S. manufactured goods rose less than expected in April, but demand for products remains strong, which should help keep factories running.

The Commerce Department said Thursday that factory orders rose 0.3% in April after rising 1.8% in March. Economists polled by Reuters had forecast factory orders would rise 0.7%.

Manufacturing, which accounts for 12% of the US economy, is trapped by continued strong demand for goods, even as spending shifts to services. A survey on Wednesday showed

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the Institute for Supply Management’s National Factory Activity Index rebounded in May after two consecutive monthly declines.

But China’s zero COVID-19 policy and Russia’s ongoing war on Ukraine could slow improving supply chains.

In April, orders for machinery, motor vehicles and primary metals increased. But orders for electrical equipment, appliances and components fell 0.2%. Orders for computers and electronic products edged up 0.1%.

Shipments of manufactured goods rose 0.2% after accelerating 2.2% in March. Factory inventories rose 0.6%. Unfilled orders rose 0.5%, matching March’s increase.

The Commerce Department also reported that orders for non-military capital goods, excluding aircraft, which are considered a measure of companies’ equipment spending plans, rose 0.4% in April over instead of 0.3% as reported last month.

Shipments of these so-called basic capital goods, which are used to calculate business capital spending in the gross domestic product report, rose 0.8% in April, as reported last month . Strong business capital spending helped support domestic demand in the first quarter, even as GDP contracted at an annualized rate of 1.5% during this period.

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Reporting by Lucia Mutikani

Our standards: The Thomson Reuters Trust Principles.

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