US factory orders fall in December on commercial aircraft bookings
US factory orders fall in December on commercial aircraft bookings
ReutersMon, February 23, 2026 at 3:52 PM UTC
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A worker welds a steel tube at HCC, a company that uses parts to make combines, at the factory in Mendota, Illinois, U.S., February 21, 2025. REUTERS/Vincent Alban
WASHINGTON, Feb 23 (Reuters) - New orders for U.S. factory goods fell in December amid a sharp decline in commercial aircraft bookings, but demand elsewhere was strong, partly driven by robust investment in artificial intelligence.
Factory orders dropped 0.7% after an unrevised 2.7% increase in November, the Commerce Department's Census Bureau said on Monday.
Economists polled by Reuters had forecast factory orders would slip 0.6%. Orders advanced 3.7% on a year-on-year basis in December. The report was delayed by last year's government shutdown, which dragged gross domestic product growth lower in the fourth quarter.
Manufacturing, which accounts for 10.1% of the economy, has been hamstrung by President Donald Trump's sweeping tariffs, which business leaders say have raised costs for factories and consumers. But some sections have been supported by the rapid adoption of AI.
The U.S. Supreme Court on Friday struck down Trump's sweeping tariffs, which he pursued under a law meant for use in national emergencies. Trump immediately imposed a 10% global tariff for 150 days to replace some of the emergency duties, before raising the rate to 15% on Saturday.
"The Supreme Court ruling doesn't reset trade policy, and President Trump's swift actions signal tariffs are here to stay even if they are adjusted in coming months," said Shannon Grein, an economist at Wells Fargo.
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Commercial aircraft orders fell 24.8% in December after soaring 98.2% in November. This category is extremely volatile. Though Boeing reported on its website that it had received 175 aircraft orders in December, the bulk of them were less expensive models. Boeing received 164 aircraft orders in November.
Orders for computers and electronic products jumped 3.1%, while those for electrical equipment, appliances and components gained 0.3%. Machinery orders climbed 0.5%.
There were strong gains in orders for fabricated metal products and primary metals. Orders for motor vehicle bodies, parts and trailers advanced 2.0%. Outside AI, business investment slowed in the fourth quarter, but an acceleration is anticipated this year because of tax cuts.
The Census Bureau also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 0.8% in December instead of 0.6%, as was initially reported last week.
Shipments of these so-called core capital goods rose 1.0% rather than the previously reported 0.9% increase.
(Reporting by Lucia Mutikani; Editing by Paul Simao)
Source: “AOL Money”
