Business spending plans gauge hits one-year high in January

WASHINGTON, Wed Feb 27, 2013 — A gauge of planned U.S. business spending increased by the most in just over a year in January and new orders for long-lasting manufactured goods excluding transportation rose solidly, pointing to underlying strength in factory activity.

The Commerce Department said on Wednesday non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, jumped 6.3 percent, the biggest gain since December 2011, after slipping 0.3 percent in December.

Economists had expected this category to only rise 0.2 percent.

Durable goods orders excluding transportation increased 1.9 percent, the largest gain since December 2011, after increasing 1 percent in December. That was well above economists’ expectations for a 0.2 percent gain.

However, overall orders for durable goods – items from toasters to aircraft that are meant to last at least three years — tumbled 5.2 percent as demand for civilian and defense aircraft fell sharply. Last month’s drop was the first since August.