WASHINGTON (MarketWatch) — Business investment got off to a poor start in 2017 aside from the aerospace industry, perhaps a sign businesses are awaiting new policies by the Trump administration before acting.
Orders for durable goods climbed 1.8% in January, but the gain was due entirely to a spike in contracts for commercial jets and military planes, the Commerce Department reported Monday.
Economists polled by MarketWatch had forecast a 1.6% increase.
The increase in January was fueled by a 70% jump in orders for passenger planes and a 60% advance in bookings for fighter jets and related military goods. Orders for new cars and trucks also edged up 0.2%
Yet if airplanes and autos are stripped out, bookings fell 0.2% in January to mark the first decline in new orders minus transportation in six months.
Orders fell for computers, networking gear, electrical equipment and primary metals used to make a variety of heavy-duty goods for businesses and consumers.
As a result, a key measure of business investment known as core capital-goods orders dropped 0.4% in January. It was the first decline in four months.
The Trump administration has promised to cut corporate taxes, reduce regulations and take other steps to help businesses. Yet uncertainty about what kind of policies will emerge from Washington might partly deter businesses from proceeding with some investments early in the year, economists say.
Still, business investment has picked up lately after a bout of weakness that began in late 2015 that largely hampered a U.S. energy industry beset by falling prices. Core investment has risen 2.4% in the past three months, a marked contrast to a decline as recently as last summer.
Shipments of core capital goods, a category used to help determine gross domestic product, fell a somewhat steeper 0.6% in January. All numbers are seasonally adjusted.