New orders for US factory goods rose 1.8% in September to $677.2B, the third straight monthly gain, the Census Bureau reported.
Economists polled by Reuters had expected a 1.2% increase, and August's gain was revised up to 0.3% from 0.1%. Orders rose 7.2% from a year earlier.
The monthly increase worked out to $12.2B above August, with transportation equipment supplying close to half of it.
Aircraft led and the strength ran broader
Transportation equipment orders climbed 4.6% to $119.9B, powered by a 28.3% surge in nondefense aircraft and parts to $25.3B.
Machinery orders rose 1.5%, computers and electronic products gained 0.8% and jumped 14.9% from a year ago, while motor vehicle bodies, parts, and trailers inched up 0.1%. Electrical equipment, appliances, and components slipped 0.3%.
Aircraft Orders Drove the September Factory Gain
Change in new orders by category, September 2026, month over month, %
Bar chart. Category. Civilian aircraft and parts: Change (%) 28.30%. Transportation equipment: Change (%) 4.60%. Machinery: Change (%) 1.50%. Computers and electronics: Change (%) 0.80%. Core capital goods: Change (%) 0.60%. Motor vehicles and parts: Change (%) 0.10%. Electrical equipment: Change (%) -0.30%.
Source: Reuters, Anadolu Agency, EconoTimes
Strip out transportation and orders still grew 1.3% to $557.4B. Durable goods rose 1.9% to $345.7B and nondurables rose 1.8% to $331.6B.
Orders for nondefense capital goods excluding aircraft, the closest read on what companies plan to spend on equipment, rose 0.6%.
Shipments in that category increased 1.2%, while across all factories backlogs climbed 0.9% to $1.62T and inventories grew 0.4% to $976B, a 12th straight monthly increase.
Factories are busy and manufacturers are unhappy
The Institute for Supply Management's Purchasing Managers' Index registered 55.5% in October, a 10th consecutive month of expansion and one point above September, with the Production Index at 59%.
Sentiment went the other way. ISM's Manufacturing Business Survey Committee chair Susan Spence said negative sentiment worsened for a third month, with 66% of respondent comments negative. Respondents cited tariffs, longer lead times, and the US-Israeli war with Iran as the main drags.
Prices have risen for 25 straight months, and the Prices Index sat at 75.2% in October even after a 2.7 percentage point drop.
"I remain convinced that we are being held back from a bigger push in expansion."
Susan Spence, Institute for Supply Management
Manufacturing accounts for roughly 9.4% of the economy, and the artificial intelligence infrastructure buildout plus steady consumer spending are holding it up.
Economists warn that rising interest rates and falling inflation-adjusted household income could bite next year, particularly in segments with no exposure to AI spending.
The dollar figures are seasonally adjusted but not adjusted for price changes, so part of the gain reflects higher prices for goods. The Census Bureau's advance report on October durable goods orders lands Nov. 25 at 8:30 a.m. ET.
