Durable Goods Orders, Jobless Claims Rise

Demand rose for a broad range of U.S. durable goods last month, government data indicated Thursday, boosting expectations for strong economic growth and increasing bets that the Federal Reserve will raise interest rates at least two more times.

New claims for unemployment benefits also rose slightly last week to 283,000 but were below forecasts, and a more reliable gauge of employment trends hit a 5 1/2 -year low, suggesting further improvement in a tightening labor market.

Analysts focused more on the December orders numbers. Morgan Stanley called it a “blowout report pointing to both a far stronger advance in fourth-quarter capital spending than we previously estimated and backlogs late in the quarter, providing heady momentum moving into the first quarter.”

New orders for U.S.-made durable goods rose a larger-than-expected 1.3% in December and the previous month was revised higher, while non-transportation orders gained 0.9%, Commerce Department data indicated.

November orders were revised up to show a 5.4% increase from a previously reported 4.4% advance.

The Labor Department said initial claims for state jobless aid rose 11,000 last week to 283,000 from an upwardly revised 272,000 the previous week.

The four-week moving average of initial claims, which smooths weekly volatility for a more reliable indication of employment trends, fell 10,750 to 288,750, the lowest level since July 2000.