In a notable shift, U.S. companies ramped up their orders for durable goods in March, reacting to impending tariffs introduced by President Donald Trump. The Commerce Department announced this surge on Thursday.
Seasonally adjusted durable goods orders climbed 9.2% for the month, a significant increase from the 0.9% rise noted in February and far surpassing the Dow Jones forecast of a 1.6% uptick. When defense orders are excluded, the growth was even more pronounced, reaching 10.4%, although orders excluding transportation remained unchanged.
A striking 27% increase in transportation equipment orders, spurred mainly by a massive 139% jump in nondefense aircraft and parts, contributed to this rise. This category encompasses various items, including appliances, computers, and jewelry, in addition to vehicles.
Meanwhile, the Labor Department provided additional economic updates, revealing that initial claims for unemployment insurance rose to a seasonally adjusted 222,000 for the week ending April 19. This figure marked a slight increase of 6,000 but was closely aligned with the Wall Street estimate of 220,000.
The rise in durable goods orders appears to be influenced by a pull-forward effect, as companies sought to position themselves before Trump’s tariff announcements, particularly following the “Liberation Day” tariffs he revealed on April 2. These tariffs included a 10% levy on all imports and specific charges against several countries, many of which were postponed for 90 days to open channels for negotiations.
A report from the Federal Reserve indicated that businesses were proactively altering their strategies in response to these impending tariffs.
According to the “Beige Book,” an economic summary, companies experienced an uptick in vehicle sales—falling under the durables umbrella—which was largely attributed to preemptive purchases in anticipation of tariff-induced price increases.
Despite the surge in durable goods orders for March, concerns remain about the broader economic outlook, particularly related to tariffs. The data suggests that the recent spike may not accurately reflect a sustained trend.
On the employment front, the jobless claims report indicates that layoffs have not escalated, despite Trump’s efforts to reduce the federal workforce.
The data showed stability in weekly claims, with continuing claims—reported a week later—dropping to 1.84 million, down 37,000 from the previous week. Unadjusted figures also revealed a decline in claims from Washington, D.C., which fell to 753, marking a decrease of 112 from the week before.
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