Durable Goods Orders Surge 5.5% in May

New orders for long-lasting U.S.-made goods leaped by a larger-than-expected 5.5 percent on a large gain in civilian aircraft orders, a government report showed on Friday.

Excluding the volatile transportation category, orders for durable goods (search) — big-ticket items meant to last three years or more — slipped unexpectedly by 0.2 percent, the Commerce Department (search) said. It was the third decline in the last four months for durable goods orders outside transportation.

Analysts were expecting all durable goods orders to rise 1 percent and for orders excluding transportation to gain 0.5 percent.

April durable goods orders were revised downward to a 1.4 percent advance. Orders excluding transportation were revised to a larger decline of 0.7 percent.

Orders for transportation equipment gained 21.2 percent in May, the biggest rise since July 2002, on a 164.8 percent surge in non-defense aircraft and parts orders.

Capital goods orders gained 14.5 percent in the month, the biggest rise since October 2001, and non-defense capital goods rose by the same amount, a record high for that category.

However, non-defense capital goods excluding aircraft, seen as a proxy for business spending, dropped 2.3 percent, the biggest slide since October 2004.

Orders excluding defense goods rose 5.3 percent, ahead of analysts' forecasts of a 1.9 percent increase.