Strong U.S. business spending on equipment seen underpinning GDP growth in Q3

  • Core capital goods orders increase 0.5% in August
  • Core capital goods shipments rise 0.7%
  • Durable goods orders surge 1.8%; unfilled orders up 1.0%

WASHINGTON, Sept 27 (Reuters) – New orders and shipments of key U.S.-made capital goods increased solidly in August amid strong demand for computers and electronic products, keeping business spending on equipment on track for another quarter of robust growth.

The sustained strength in business investment is expected to limit the hit on economic growth from an anticipated slowdown in consumer spending in the third quarter as the boost from fiscal stimulus fades and COVID-19 infections flare up. Demand for goods is being driven by businesses desperate to replenish inventories, but strained supply chains remain a challenge.

“The outlook for business equipment investment remains bright, with the latest business surveys suggesting growth will be sustained close to the pace seen in recent quarters,” said Michael Pearce,…

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