U.S. Factory Orders Rise Strongly in March
New orders for factory goods in the United States increased more than expected in March, driven by strong demand for electronics linked to the ongoing artificial intelligence investment boom.
Monthly Growth Beats Forecasts
According to the U.S. Census Bureau, factory orders rose 1.5% month-over-month, marking the largest increase since November. This follows an upward revision of February’s figure to 0.3%.
Economists had forecast a more modest 0.5% increase. On an annual basis, orders climbed 3.7% in March, highlighting improving momentum in the manufacturing sector.
Manufacturing Sector Shows Signs of Recovery
Manufacturing, which represents about 10.1% of the U.S. economy, is showing early signs of recovery after being impacted by tariffs introduced under Donald Trump last year.
However, challenges remain. Rising geopolitical tensions, particularly involving Iran, have pushed input costs higher. Oil prices have surged significantly, while supply chain pressures have led to longer delivery times for manufacturers.
Electronics Demand Hits Multi-Decade High
The strongest growth came from the computers and electronics category, which recorded its highest monthly order level in 25 years. Orders in this segment rose 3.6% to $29.6 billion, the highest level since March 2001.
Within this category, demand for electromedical, measuring, and control instruments surged 7.9% to a record $10.6 billion, reflecting growing investment in advanced technologies.
Durable and Non-Durable Goods Both Increase
Orders for durable goods increased by 0.8%, in line with previous estimates. Meanwhile, non-durable goods orders rose 2.1%, reaching their highest level since October 2022.
Market Outlook
Overall, the latest data points to strengthening demand in key manufacturing segments, particularly those tied to artificial intelligence and advanced technology. While external pressures such as rising costs and geopolitical risks persist, the sector is showing resilience and gradual recovery.
