Capital Goods Orders Surge Amid Economic Jitters

U.S. orders for capital goods rose more than expected in December, signaling potential growth in business investment. However, concerns loom over consumer confidence and inflation, especially after Boeing's strike affected manufacturing. Despite these challenges, government plans for tax cuts may boost spending. Economists foresee GDP growth at 2.6% for Q4.

U.S. orders for manufactured capital goods increased more than projected in December despite impacts from a Boeing strike, hinting at a potential uptick in business investment as the new year unfolds. The Commerce Department revealed these figures on Tuesday, spurring expectations for a promising start to the first quarter.

The report raised hopes partly due to anticipated tax cuts and reduced regulatory hurdles from the Trump administration, although potential tariffs pose a challenge. Meanwhile, the decrease in consumer confidence, driven by job market concerns and higher inflation expectations, suggests a cautious economic outlook.

According to a Reuters survey, GDP growth is expected to hit 2.6% for the last quarter, reflecting apprehension in previous downturns amidst the Federal Reserve's monetary adjustments. As stock markets climbed, consumer sentiment languished, reflecting broader apprehensions in labor and housing sectors.

(With inputs from agencies.)