Factory Orders in U.S. Increased Less Than Forecast in April

(Bloomberg) Orders placed with U.S. factories rose less than forecast in April as demand for non-durable goods dropped, probably reflecting lower fuel costs.

The 1 percent increase in bookings followed a revised 4.7 percent decline the prior month, the Commerce Department reported today in Washington. The median forecast of 61 economists in a Bloomberg survey predicted orders would climb by 1.5 percent. Demand for durable goods, those meant to last at least three years, rose 3.5 percent, while that for non-durables decreased 1 percent.

The increase in orders for durables probably means companies are looking beyond the slowdown in economic growth this quarter as housing rebounds and consumer confidence improves. At the same time, government cutbacks are restraining total demand and employment, which means the rebound will be slow to develop.

“The economy is gradually healing, and as we move through time you’ll see manufacturing do better,” Michael Moran, an economist at Daiwa Capital Markets in New York, said before the report. Moran, who is the second-best forecaster of factory orders in the last two years based on Bloomberg data, predicted a pick-up as the effects of fiscal tightening wear off. “I think what is happening, and what has to happen, is that we just finish the healing process that has been ongoing.” ...................(more)

The complete piece is at: http://www.bloomberg.com/news/2013-06-05/factory-orders-in-u-s-increased-less-than-forecast-in-april.html