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Rise in US factory orders beats expectations in July

By Sohail Khan 2 September 2026, 8:21 pm

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Rise in US factory orders beats expectations in July
Synopsis

In July, new factory orders in the United States saw an increase of 0.9%, bouncing back from a previously revised 0.2% decrease. The surge in demand for civilian aircraft and parts was notable, contributing significantly to this rebound. Additionally, motor vehicles and machinery categories reported growth. In contrast, orders for computers and electronic products faced a minor downturn during this timeframe.

US Bureau of Labour Statistics show employment down by 79,000 in preliminary estimate

WASHINGTON: New orders for U.S. factory goods increased more than expected in July amid a rebound in demand for aircraft.

Factory orders rose 0.9% after a revised 0.2% drop in June, the Commerce Department's Census Bureau said on Wednesday. Economists polled by Reuters had forecast orders would rebound 0.6% ‌after a ⁠previously ⁠reported 0.3% drop in June.

Orders advanced 6.5% on a year-over-year basis in July. Manufacturing, which accounts for 9.4% of the economy, is getting a tailwind from the artificial intelligence buildout, though the six-month U.S.-Israeli war with Iran is straining supply chains and keeping input prices elevated. An Institute for Supply Management survey on Tuesday ⁠showed manufacturers grumbling ‌about higher prices in August because of the war and import tariffs, with some describing the economy ⁠as "annoying."

The rebound in factory orders in July was led by a 12.7% surge in orders for civilian aircraft and parts. Orders for motor vehicle bodies, parts and trailers rose 0.4%. Machinery orders increased 0.8%. Orders for computers and electronic products dropped 1.1%, but were up 14.3% year over year. Orders for electrical equipment, appliances and components fell 0.3%.

The ‌Census Bureau also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on ⁠equipment, were unchanged in July rather than up 0.2%, as reported last week.

Shipments of these so-called core capital goods increased 1.2% instead of the initially estimated 1.4%.

The slowdown in core capital goods orders in July is likely temporary. The government last week reported a surge in capital goods imports in July. The AI spending frenzy is also fueling imports and business spending on equipment.

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