WASHINGTON - Businesses ordered more machinery and equipment from US factories in February, a signal that many are investing in their companies despite the expiration of a tax credit.
Orders to US factories increased 1.3 percent in February, the Commerce Department said. That offset a similar decline in January.
Demand for so-called core capital goods, a gauge of business investment plans, rose 1.7 percent. That was better than the government’s preliminary estimate last week and followed a steep drop in January.
US factory orders have been steadily rising since the recession ended nearly three years ago. Orders totaled $468.4 billion in February, just 3.4 percent below the previous peak hit in 2008.
Last year, businesses could reduce their taxable profits by an amount equal to the cost of a major investment. The credit spurred a jump in orders for industrial machinery, computers, and other capital goods at the end of last year. Spending on core capital goods surged 3.5 percent in December, then fell by nearly as much in January after the tax credit expired.
In February, orders for durable goods rose 2.4 percent. That was higher than the estimate the government made in last week’s preliminary report.
Transportation orders rose a solid 3.9 percent in February. Demand in the volatile commercial aircraft category increased 6 percent. Orders for cars and auto parts edged up 0.2 percent.
Orders for nondurable goods, such as paper and food, rose 0.4 percent in February.
A vibrant manufacturing sector has helped drive the best job growth in two years. The economy added an average of 245,000 jobs per month from December through February. Manufacturers have added more than 100,000 jobs in the past three months.
The Labor Department will release the March jobs report on Friday. Economists forecast employers added 210,000 jobs and the unemployment rate stood at 8.3 percent.