Companies in March accelerated their orders for big-ticket long-lasting goods ahead of President Donald Trump’s aggressive tariffs on U.S. imports, the Commerce Department reported Thursday.
So-called durable goods orders soared a seasonally adjusted 9.2% on the month, up from a 0.9% gain in February and well ahead of the Dow Jones forecast for a 1.6% increase. Excluding defense, the increase was even higher, at 10.4%, though the ex-transportation number was flat.
Transportation equipment orders surged 27%, led by a 139% increase in nondefense aircraft and parts. In addition to aircraft and autos, the durables category also includes items such as appliances, computers and jewelry.
In other economic news Thursday, the Labor Department reported that initial claims for unemployment insurance rose to a seasonally adjusted 222,000 for the week ending April 19, an increase of 6,000 though roughly in line with the Wall Street consensus of 220,000.
On the durables goods side, the advanced report reflects a pull-forward effect as Trump dangled threats against U.S. trading partners through March before announcing his “Liberation Day” duties on April 2. Trump slapped a 10% tariff against all imports as well as a select charges against dozens of countries that he ultimately tabled for 90 days for negotiations.
A Federal Reserve report Wednesday indicated that companies were adjusting behavior to get ahead of the Trump tariffs.
The economic summary, known as the “Beige Book,” said companies in particular saw an increase in vehicle sales, which would fall under the durables category, “generally attributed to a rush to purchase ahead of tariff-related price increases.”
The report otherwise showed apprehension about economic conditions, particularly in light of the tariffs, indicating that the burst in durables orders for March is likely not indicative of the long-term broader environment.
On the labor front, the jobless claims report showed that layoffs are not rising despite Trump’s efforts to slice the federal employment rolls.
In addition to the stable weekly numbers, continuing claims, which run a week behind, declined to 1.84 million, down 37,000 from the prior week. Claims in Washington, D.C. also fell, down to 753, or a decrease of 112 from the prior week, according to unadjusted numbers.
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