The 5.2% rise in December durable goods orders

January 30, 2008 at 6:31 am | Posted in economy, USA | Leave a comment
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American factories received far more orders for durable goods than expected last month, data released on Tuesday showed, and even allowing for the well-known volatility of the data, the report painted a picture of an economy that is stronger than recent financial-market activity has indidcated.

The 5.2% rise in December durable goods orders was the largest in five months, and it raises questions about what kind of interest-rate relief investors can expect. Last week, the Federal Reserve instituted an emergency three-quarters-point cut in its federal funds target and its discount rate after world equity markets tumbled. Investors had been expecting an additional reduction of a quarter or a half point at the end of the two-day meeting of Federal Reserve policymakers that began on Tuesday, but the strong durable goods report raised questions about why the economy would need so much stimulus

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