US durable goods orders rose 1.8% in September to $345.4 billion, beating the Wall Street Journal consensus of 1.7%, led by a 4.6% jump in transportation equipment; Treasury yields rose after the release ahead of Wednesday's Fed decision.
Orders for American-made durable goods rose more strongly than expected in September, the Census Bureau reported on Tuesday, in a bright spot for manufacturing a day before the Federal Reserve announces its interest-rate decision. New orders increased 1.8 percent from August to $345.4 billion, a gain of $6.3 billion.
The rise beat the consensus expectation — economists polled by the Wall Street Journal had forecast a 1.7 percent increase — and followed a modest 0.1 percent gain in August. Transportation equipment once again drove the headline, with orders up 4.6 percent to $119.8 billion, while orders excluding defence rose 2.2 percent.
The figures point to resilient demand for long-lasting manufactured goods, from aircraft to machinery, even as borrowing costs remain high. Transportation has repeatedly led the series in recent months, which means the headline strength says more about aircraft and vehicle orders than about a broad-based factory boom.
Markets took note. Treasury yields reversed early declines and moved higher after the release, with the 10-year yield touching about 5.0 percent, as traders weighed stronger factory demand against the Federal Reserve's policy meeting, which opened on Tuesday and concludes with a decision on Wednesday afternoon.
The report does not by itself settle the outlook. Durable goods orders are volatile month to month, and the concentration of growth in transportation leaves open whether business investment more broadly is accelerating or merely tracking a strong month for big-ticket transport orders. The next reads — third-quarter GDP on Thursday and the Fed's statement on Wednesday — will give that question more context.
People Sentiments Public Mood: Positive
- Economists polled by the Wall Street Journal expected 1.7% — the 1.8% print beat expectations
- Bond market: Treasury yields reversed early declines and rose after the release
- Analyst caution: transportation accounted for most of the gain, so the rise does not prove broad-based acceleration