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Durable goods orders rise, but business investment measure falls

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Durable goods orders rise, but business investment measure falls

Orders for long-lasting goods unexpectedly surged in December, but a measure of business investment fell for the seventh straight month. Orders for manufactured durable goods such as computers, metals and electrical equipment rose 4% on a healthy rebound in motor vehicles and transportation. Economists expected a rise of 0.6%.635654604836125624-AP-Durable-Goods

But demand for items excluding aircraft and defense – a proxy for business investment — fell 0.5% and have declined seven straight months. A strong dollar is making U.S. exports more expensive for foreign buyers, hobbling manufacturers. Last month, orders increased 5.4% for motor vehicles and 6.2% for defense-related aircraft. Demand for computers and related products jumped 10.6%.

But orders decreased 1.6% for machinery, such as factory equipment, and 0.3% for primary metals. Many economists expect a solid domestic economy fueled by stronger consumer spending amid still-low gasoline prices to spark an upswing in business investment later this year.