Orders For U.S. Durable Goods Rose Less Than Forecast In March

Orders for U.S. durable goods climbed less than forecast in March as demand for capital equipment remained weak, a sign that a diminished growth outlook is impeding investment.

Bookings for items meant to last at least three years rose 0.8 percent after a revised 3.1 percent slump a month earlier, data from the Commerce Department showed Tuesday. The median forecast in a Bloomberg survey called for a 1.9 percent advance. Orders for business equipment were little changed last month, also weaker than projected.

Businesses continue to grapple with soft global sales and middling U.S. consumer spending, which make it difficult to justify expanding plans for capital outlays. Scope for a pickup will be limited until demand accelerates and companies feel more confident that their investments will pay off.

"At best you're treading water here," said Jacob Oubina, a senior U.S. economist at RBC Capital Markets LLC in New York, whose forecast for business equipment orders was among the closest in the Bloomberg survey. "There is a general carving out of a bottom in the weakness that's plagued the manufacturing space, but I don't think we're heading into a significantly more upbeat backdrop unless you start to see a firmer recovery in oil."

Projections in the Bloomberg survey for all durable goods orders ranged from a 0.6 percent drop to a 3.7 increase. The February decline was revised from a previously reported 3 percent drop.

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