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US factory orders up 1.9 per cent in April, best in 6 months

WASHINGTON – Orders to U.S. factories increased by the largest amount in six months but much of the strength came from a rise in demand for commercial aircraft.

A key category that tracks business investment plans fell.

Factory orders increased 1.9 per cent in April, the biggest gain since a 2.4 per cent rise in October, the Commerce Department reported Friday. Orders had been up 1.7 per cent in March after having fallen in February.

Demand in a category that serves as a proxy for business investment spending declined 0.6 per cent after a small 0.3 per cent increase in March and a 2.1 per cent February decline.

Manufacturing has been hurt in the past year by a big plunge in investment spending in the oil industry and weakness in exports, which reflect a global slowdown and the strong dollar.

Orders for durable goods such as autos and appliances increased 3.4 per cent, unchanged from a preliminary report, while demand for nondurable goods such as chemicals and paper, increased 0.4 per cent after a 1.4 per cent rise in March.

The increase was led by a 65.3 per cent surge in orders for commercial aircraft, a volatile category from month to month, which was rebounding after two months of declines.

Orders for machinery fell 1.9 per cent, led by an 86.1 per cent plunge in demand for mining and oil field equipment. This sector has been hurt by the cutbacks in exploration and drilling that have come after the big plunge in energy prices.

Demand for computers rose 3.5 per cent while orders for furniture dropped 2.2 per cent in April.