WASHINGTON (AP) - Companies' demand for long-lasting manufactured goods rose by the largest amount in four months in November, driven by a jump in orders for planes.
The Commerce Department says orders to U.S. factories for durable goods rose 3.8 percent in November. It was the biggest gain since July. But so-called core capital goods, a proxy for business investment spending, dropped for a second straight month. They fell 1.2 percent.
The declines in business capital goods excluding aircraft raise doubts about a pocket of strength for the economy this year. Business investment spending has surged as companies stepped up orders to take advantage of tax breaks that are set to expire at year's end.
Manufacturing has been a bright spot for the economy. U.S. factory activity has been lifted by a surge in exports. But some economists are concerned that Europe's debt crisis will push that region into a recession, cutting demand in a market that accounts for about one-fifth of U.S. exports.
Excluding the volatile transportation sector, orders would have risen a more modest 0.3 percent in November, the third straight decline.
Factories that make primary metals such as steel reported a strong 5.2 percent increase in demand.