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Business investment boosts orders for long-lasting goods

Businesses bought more machinery last month, lifting orders for long-lasting goods although not as much as economists had expected.

The Commerce Department reported Wednesday that new orders for durable goods rose 2.2 percent in February, after a drop of 3.6 percent in January. Economists had been expecting orders to rise by 3 percent.

"This number is another piece of the puzzle that seems to be coming together to form a picture that the economy is slowly improving, but it is definitely a halting recovery where we're not accelerating to any great degree," said Liam Dalton, president of Axiom Capital Management Inc.

Durable goods range from toasters to big-ticket items like aircraft which are meant to last three years and more.

Excluding transportation, orders climbed 1.6 percent. Economists had expected that reading to increase 1.7 percent. Machinery orders increased 5.7 percent.

Non-defense capital goods orders excluding aircraft, a closely watched proxy for future business investment, edged 1.2 percent higher, missing analysts' expectations of a 2.0 percent gain.

A 3.9 percent increase in bookings for transportation equipment - including a 6.0 percent increase in civilian aircraft orders - drove the overall increase in durable goods orders.

Boeing received 237 orders for aircraft during the month, according to the plane maker's website, up from 150 in January.

Orders for motor vehicles edged up 1.6 percent.

Shipments of non-defense capital goods orders excluding aircraft, which go into the calculation of gross domestic product, rose 1.4 percent in February.

Reuters contributed to this report.