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U.S. Factory Orders Jump 1.5% as Electronics Surge on AI Spending

AI-linked electronics demand is driving a broader capex upswing.

Overview

  • The Commerce Department reported Monday that March factory orders rose 1.5%, topping forecasts and marking the strongest monthly gain since November.
  • Computers and electronic products jumped 3.6% to $29.6 billion, the biggest one-month increase in 25 years, with electromedical and measuring instruments up 7.9% to a record $10.6 billion.
  • A key gauge of business equipment demand, nondefense capital goods excluding aircraft, was revised to a 3.4% increase, while shipments rose 1.2%.
  • Total inventories rose 0.6% and the inventories-to-shipments ratio edged to 1.51 months, a sign that orders reflect real demand rather than stockpiling.
  • Broader measures also improved as nondurable goods orders rose 2.1%, even as reports cite higher input costs and longer delivery times linked to the U.S.-Israeli war with Iran and a near-50% jump in oil prices.