- Durable Goods Orders Surge in August
The surge in orders for business equipment boosted durable goods demand in August than forecast.
Non-military goods orders excluding aircraft increased by 0.9 percent, below the 1.1 percent recorded in the previous month but higher than the 0.3 percent gain forecast.
Shipment of goods used in calculating gross domestic product jumped 0.7 percent in August, better than the 0.1 percent economists projected.
Bookings for all durable goods in August rose 1.7 percent from a 6.8 percent decrease in July, according to the Commerce Department report released on Wednesday.
The surge in orders for business equipment indicates continuous investment growth in the third quarter. Another sign that demands and labor market remains healthy.
However, a better global economic outlook and a weaker U.S. dollar will further spur overseas demands.
The Fed Chair, Janet Yellen said on Tuesday in Cleveland that changed in global economic outlook could slow down or outright hurt current progress if the Fed move too gradually “at a period of high uncertainty.”
While at the same time saying it would be imprudent to wait until inflation rate is back to 2 percent target before adjusting monetary policy. A mixed outlook of the market.
Meanwhile, pending home sales declined by the most since January.
According to the National Association of Realtors Wednesday report, the index dropped 2.6 percent in August after a previous 0.8 percent decline. Experts attributed the drop to high homes prices that impede first-time buyers from purchasing.
“August was another month of declining contract activity because of the one-two punch of limited listings and home prices rising far above incomes,” Lawrence Yun, NAR’s chief economist, said in a statement. “Further complicating any sales improvement in the months ahead is the fact that Hurricane Harvey’s damage to the Houston region contributed to the South’s decline in contract signings in August, and will likely continue to do so in the months ahead.”
The U.S dollar rose to a 6-week high against the Euro on Wednesday, trading at $1.1734. While the pound sterling dipped 0.53 percent to $1.3385 as of 10:52 am New York time.