WASHINGTON (AP) _ Orders to U.S. factories for big-ticket manufactured goods posted a moderate increase in April, helped by a continued rebound in business investment.
The Commerce Department reported Thursday that demand for durable goods increased by 0.6 percent last month. While the increase was less than had been expected, the government sharply revised the March performance to show a 5 percent surge, much stronger than the 3.7 percent gain previously reported.
Analysts believe that U.S. factories, which have been buffeted by the weakness in housing and slumping demand for autos, are starting to stage a moderate rebound, helped by reviving interest on the part of businesses to spend money to expand and modernize.
In other economic news, the number of newly laid off workers filing applications for unemployment benefits rose to 311,000 last week, an increase of 15,000. But even with the gain, claims remain at a level indicating a healthy labor market.
The overall economy slowed in the first three months of this year to an annual growth rate of just 1.3 percent, the weakest performance in four years, as a steep slump in housing continued to weigh on the economy's performance.
Analysts are hoping that spending by consumers and businesses will be able to overcome the weakness in housing and keep the country out of a recession.
The report on durable goods offered encouragement in the area of business investment. It showed that demand for capital goods excluding airplanes, considered a good proxy for business investment, rose by 1.2 percent in April following, the second solid monthly increase.
The 0.6 percent rise in total durable goods orders came even though demand for transportation products fell by 1.3 percent. This reflected a drop of 10.7 percent in demand for commercial aircraft and a 1.9 percent fall in orders for motor vehicles.
Excluding transportation, orders would have been up by 1.5 percent, the same performance as in March.
There was strength in orders for primary metals such as steel which rose by 4.3 percent and orders for electronic equipment and appliances, which rose by 3.8 percent.
But demand was weak for computers, which fell by 7.8 percent, and communications equipment, which dropped 5 percent.