U.S. factory orders improve in February

Factory orders in the U.S. improved in the month of February, coming in above consensus expectations. Orders rose 1.2 percent sequentially, as compared with consensus expectations of 1.7 percent. The orders in February rose following a strong preliminary report on durable goods orders that showed a 3.1 percent rise in total orders. But this morning’s report including revisions to the durable goods orders data as well.

Growth in total durable goods orders was downwardly revised by one-tenth, while growth in core durable capital goods orders was downwardly revised by four-tenths. The additional information contained in today’s report was the growth in non-durable goods orders that dropped 0.5 percent on the month, as compared with the expectation of a modest rise, and contributed to much of the miss relative to the projection.

In all, the report released today was slightly softer than anticipated. Downward revisions to core capital goods orders imply slightly lower equipment investment in the first quarter. Meanwhile, inventories were stronger than anticipated and suggest higher accumulation, noted Barclays in a research report.

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