US factory orders rise sharply in November By Reuters

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© Reuters. FILE PHOTO: A worker operates one of the metal cutting machines at the Gent Machine Co. plant in Cleveland, Ohio, United States, May 26, 2021. REUTERS / Timothy Aeppel

WASHINGTON (Reuters) – New orders for manufactured goods in the United States accelerated in November, but business capital spending likely struggled to rebound in the fourth quarter.

The Commerce Department said Thursday that factory orders rose 1.6% in November. Data for October has been revised up to show orders up 1.2% instead of 1.0% as previously reported.

Economists polled by Reuters had expected factory orders to grow 1.5%. Orders increased 12.9% year-on-year.

The manufacturing sector, which represents 11.9% of the economy, is supported by companies which replenish their depleted stocks.

Orders for computers and electronics as well as transportation equipment increased. But orders for machinery fell, as did orders for electrical equipment, appliances and components.

There are signs that raw material and labor shortages are starting to ease. A survey by the Institute for Supply Management on Tuesday showed that its measure of the prices paid for inputs by factories fell the most in a decade in December.

Shipments of manufactured products rose 0.7% in November after jumping 2.0% in October. Factory inventories rose 0.7%. Unfilled orders rose 0.7% after gaining 0.3% the month before.

The Commerce Department also reported that orders for non-military capital goods, excluding aircraft, which are considered a measure of companies’ spending plans on equipment, were unchanged in November instead of falling by 0 , 1% as shown last month.

Shipments of these basic capital goods, which are used to calculate business capital spending in the gross domestic product report, rose 0.3% in November, as previously reported.

Business capital spending contracted in the third quarter after four consecutive quarters of double-digit growth.

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