Factory Orders Rise in January

Orders placed at U.S. factories rose 2.1% in January, their largest increase in six months, the Commerce Department said Thursday.

The increase in orders, which followed a revised increase of 0.3% in December, moved the total value of the goods ordered grew to $327.1 billion, Commerce said.

Excluding orders for transportation equipment, orders rose 1.5% -- their biggest gain since April.

A consensus estimate of a 1.9% increase in orders was reached by a Bloomberg News survey of economists.

The inventory-to-sales ratio, the measure of how long goods sit unsold on store shelves fell to 1.31 months, equaling a record low. The ratio was 1.34 months in December.

Factory inventories totaled $430.8 billion, down slightly from $431 in December.

Analysts told Bloomberg the decline in inventories could be good news for the economy because it could lead to increases in orders and production in the second half of 2003.

Trucking companies could benefit tremendously from an uptick in the manufacturing sector, which is one of the industry’s largest customers.

The increase in January was led by a 2.9% increase in orders for durable goods, Commerce said. Durable goods orders account for more than half of the overall report.

Vehicle orders jumped 14.6% - their largest increase since August 1998.

A report on fourth-quarter productivity released earlier in the day said that productivity increased during the final three months of 2002.