New orders for durable goods increased 5.7% in February, the best month since last September, the Census Bureau reports. But the good news was marred by a 2.7% retreat in business investment (new orders for capital goods less defense and aircraft) last month. The mixed news extends to the year-over-year changes, with new orders overall rising 3.8% vs. year-earlier levels while business investment slumped 1.1% in February compared with a year ago. The update isn’t going to impress anyone, but the numbers du jour at least provide some support for thinking that the long-running deceleration in growth for new orders may have run its course.
It’s worth mentioning that durable goods orders have been out of step with upbeat economic news from elsewhere in the economy in recent months. Indeed, most of the February data skews positive, as I noted last week. The weakness in durable goods orders shouldn't be ignored, but so far it's proven to be a misleading indicator of the broad economic trend.
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