New orders for durable goods increased 0.7% in April.
The U.S. Census Bureau announced in a press release on Friday (May 24) that orders for the month increased by $1.9 billion to $284.1 billion.
According to the announcement, durable goods orders in April increased for the third consecutive month, following a 0.8% increase in March.
The most recent month’s increase was led by a 1.2% increase in transportation equipment, the report said.
Excluding transportation, new orders rose 0.4% in April, the report said, and were little changed excluding defense.
Reuters reported on Friday that orders for non-defense capital goods excluding aircraft, which are said to indicate companies’ spending plans, rose more than expected.
The Census Bureau reported that the April figure was 0.3%, higher than the 0.1% forecast by economists surveyed by the outlet.
While April data showed a modest improvement in business capital spending, the report said investment remained constrained by higher borrowing costs, a stronger dollar and weak global demand. Interest rates have dampened demand for goods and made financing more expensive for companies.
In September, it was reported that rising interest rates were leading to an increase in chief financial officers cutting spending.
About 40% of chief financial officers are cutting capital and non-capital expenditures in response to the Fed’s interest rate hikes, up from 32% in the fourth quarter of 2022, according to a survey released by Duke University’s Fuqua School of Business, the Federal Reserve Bank of Atlanta and the Federal Reserve Bank of Richmond.
The Census Bureau report was released the same day that Treasury Secretary Janet Yellen told the Financial Times that rising costs of basic goods such as food, rent and mortgages were weighing on many American consumers.
According to the Financial Times, Yellen said the price increases were “significant,” rapid and noticeable to consumers.
“The cost of living is an issue for a lot of people,” Yellen said, according to the report. “So I think this is a legitimate concern that people have.”
Inflation continues to affect U.S. consumer life, with roughly two-thirds of households saying high prices have “worsened” their financial situation, the Fed said in a separate recent report.
65% of consumers said rising prices have had a negative financial impact on them, including 19% who said their situation has become “much worse.”
