Durable-Goods Orders Up 1.7%, Exceeding Forecasts

The transportation sector helped orders for U.S. durable goods rise more than expected in July, but new-home sales showed signs of buckling amid higher interest rates, reports showed Wednesday.

Orders for long-lasting goods gained 1.7% in July, their biggest monthly increase since March, the Commerce Department said. Excluding transportation, orders were up 0.1%. Transportation orders surged 5.6%, thanks to more than a doubling of orders for civilian aircraft.

June’s overall orders for durable goods were revised up, to a 1.1% advance from a previously reported 0.9% jump.

July overall’s gain was well above a 1% rise expected by Wall Street. But economists were concerned that much of the rise was in one sector.

Two other reports raised the prospect that higher interest rates are reducing demand for housing.

The Commerce Department said sales of new homes slid 6.4% in July to an annual rate of 1.13 million, their slowest pace since December. Analysts had expected a 1.29 million pace.

In a separate report, the Mortgage Bankers Assn. said new applications for U.S. home loans fell last week. The group’s market index, a measure of mortgage activity, declined 6.3% to 646.3 from the previous week’s 689.4.