Orders to U.S. factories for manufactured goods jumped 1.8 percent in August due mainly to rising costs of petroleum products following the Persian Gulf crisis, the government said Wednesday.
The Commerce Department said orders for both durable and non-durable goods totaled a seasonally adjusted $244.6 billion following a 1.5 percent gain in July."Most of the increase is attributed to the petroleum refining industry, which had substantial price increases during the month," the report said. Petroleum and coal orders were up $3 billion. "Excluding petroleum, orders increased 0.6 percent," it said.
Overall non-durable goods orders, which include petroleum, advanced 4.4 percent to $117.1 billion in August. They had edged up just 0.2 percent in the month prior to the Aug. 2 Iraqi invasion of Kuwait.
Many analysts had expected a decline in overall orders following last week's report that durable goods orders fell 0.8 percent. That drop in usually high-priced items expected to last more than three years was revised to 0.5 percent in today's report.
Durable orders totaled $127.5 billion in August after rising 2.7 percent in July.
Defense orders also jumped following the Iraqi invasion, up 14.4 percent to $8.6 billion after declining 5.1 percent a month earlier. Excluding defense, orders were up 1.4 percent.
In the key category of non-defense capital goods, a barometer of business investment plans, orders plunged 10.2 percent to $35.8 billion, erasing a 10.1 percent advance in July.
Transportation orders rose 1.8 percent to $35.4 billion after a 4.6 percent gain a month earlier. Excluding transportation, orders were up 1.8 percent.
"Within transportation, increases in motor vehicles and parts and shipbuilding and tanks more than offset a decline in aircraft and parts," the report said.
Shipments, which also were influenced by the petroleum refining industry, rose 3.4 percent to $245.9 billion. Excluding petroleum, shipments were up 2.3 percent.
Unfilled orders, which were not affected by energy, declined 10.2 percent to $518.7 billion. The order backlog has been relatively unchanged since May, the department said.
Inventories edged up 0.2 percent to $373.9 billion but excluding petroleum, were unchanged from July.
Among durable goods, electrical machinery orders posted a gain in August, up 2.9 percent to $20.9 billion after rising 1.5 percent in July.
Registering losses were non-electrical machinery, down 5.0 percent to $21.4 billion following a 3.5 percent gain, and primary metals, rebounding 2.3 percent to $11.5 billion after a 2.7 percent decline.