WASHINGTON (Reuters) - New orders for U.S.-made goods rose for a second straight month in September and orders for core capital goods were stronger than previously reported, suggesting manufacturing activity was gathering momentum.
Factory goods orders increased 1.4 percent as demand for a range of goods rose, the Commerce Department said on Friday. Orders increased by an unrevised 1.2 percent in August.
Economists had forecast factory orders increasing 1.3 percent in September.
Orders for non-defense capital goods excluding aircraft -seen as a measure of business spending plans - surged 1.7 percent in September instead of the 1.3 percent increase reported last month. September's increase in these so-called core capital goods orders was the largest since July 2016.
Orders for core capital goods rose 1.4 percent in August. Shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, increased 0.9 percent instead of the previously reported 0.7 percent rise.
The Commerce Department said it was unable to isolate the impact of Hurricanes Harvey and Irma on the data as the survey is "designed to estimate the month-to-month change in manufacturing activity at the national level and not at specific geographic areas."
Strong business spending on equipment is helping to underpin manufacturing, which makes up about 12 percent of the U.S. economy. Manufacturing is also being buoyed by a weakening U.S. dollar, replenishing of business inventories and strengthening global demand. Business investment in equipment has contributed to GDP growth for four straight quarters.
Spending is rising despite signs of slowing oil and gas drilling as ample supplies curb crude oil price increases.
In September, orders for machinery gained 0.1 percent after being unchanged in August. Mining, oil field and gas field machinery orders rebounded 17.8 percent after tumbling 7.5 percent in August.
Orders for transportation equipment rose 4.7 percent, reflecting a 30.8 percent jump in civilian aircraft orders. Motor vehicle orders edged up 0.1 percent after accelerating 2.5 percent in August.