New orders to the nation's factories for durable goods increased 2.3 percent in May after a sharp decline in April, the government announced yesterday.
Stepped up orders for motor vehicles and parts and fabricated metal products were largely responsible for the turn-around.
The Commerce Department said new durable goods orders increased by $1.8 billion to $79 billion in May.
Some $1 billion of that increase was in transportation epuipment, with the biggest part of the gain in motor vehicles and parts.
Most of the remaining $800 million increase was attributed to the fabricated metals industries.
The sharp drop in April - originally reported as 8.7 percent, new revised to 8.2 percent - was widely seen as a dramatic sign the economy is slowing down, and, some economists said, entering a recession.
While individual figures fluctuate, government economists still believe the economy is entering a slowdown, but not a recession.
Durable goods are generally those which last three months or more and include such things as steel and household appliances. Encreases in orders in general mean businessmen anticipate favorable economic conditions.
Orders declined in some categories, especially in the aircraft and parts industries, shipbuilding, steel mills and miscellaneous durables. Steel orders declined $200 million in May or 2.5 percent, following a $1 billion, or 14 percent, drop in April.
The nondefense capital goods industries showed a slight increase in new orders of $200 million, or 0.7 percent, to $21.4 billion. A large order increase for railroad cars offset most of a decline in commercial aircraft orders for the month.
Orders for defense capital goods rose $500 million, or 14 percent, to $3.9 billion. This followed an April increase of 4.9 percent.
Shipments of durable goods in May increased $4.8 billion, or 6.6 percent, to $76.9 billion. This followed a record decline of 7.3 percent in April. CAPTION: Graph, Durable Goods, The Washington Post