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US durable goods orders soar in May on aircraft
US durable goods orders soar in May on aircraft

Reuters

time26-06-2025

  • Business
  • Reuters

US durable goods orders soar in May on aircraft

WASHINGTON, June 26 (Reuters) - Orders for long-lasting U.S. manufactured goods rebounded sharply in May, boosted by a surge in commercial aircraft bookings, though economic uncertainty stemming from import tariffs remains a constraint for business spending on capital. Orders for durable goods, items ranging from toasters to aircraft meant to last three years or more, jumped 16.4% last month after a revised 6.6% decline in April, the Commerce Department's Census Bureau said on Thursday. Economists polled by Reuters had forecast orders increasing 8.5% after a previously reported 6.3% decrease in April. Transportation equipment orders soared 48.3%, driven by a 230.8% surge in commercial aircraft orders, which are extremely volatile. Boeing (BA.N), opens new tab reported on its website that it had received 303 aircraft orders, including 150 from Qatar Airways placed during President Donald Trump's visit to the Gulf Arab country in May. That compared to only eight orders in April. Outside the transportation industry, orders were muted. Economists say Trump's often shifting trade policy has left businesses in limbo while the duties already imposed have increased costs for companies. The Federal Reserve is also in a wait-and-see mode as policymakers monitor the economic fallout from the sweeping tariffs. Fed Chair Jerome Powell told lawmakers this week the U.S. central bank needed more time to gauge if tariffs pushed up inflation before considering lowering rates. The Fed last week left its benchmark overnight interest rate in the 4.25%-4.50% range where it has been since December. Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rebounded 1.7% in May after an upwardly revised 1.4% decline in April. Economists had forecast these so-called core capital goods orders edging up 0.1% after a previously reported 1.5% drop in April. Shipments of core capital goods rose 0.5% after being unchanged in the prior month. Non-defense capital goods orders accelerated 49.4% after plunging 19.1% in April. Shipments of these goods were unchanged after advancing 3.6% in April. Business spending on equipment accelerated sharply in the first quarter, helping to blunt some of the drag on gross domestic product from a flood of imports as businesses rushed to bring in merchandise before the tariffs came into effect. The Atlanta Fed is forecasting economic growth rebounding at a 3.4% annualized rate in the second quarter, largely reflecting a reversal in the import flows. Data on retail sales, the housing and labor markets have suggested economic activity is softening. The economy contracted at a 0.5% pace in the January-March quarter.

Airbus raises dividend payout range and confirms 2025 guidance
Airbus raises dividend payout range and confirms 2025 guidance

Khaleej Times

time18-06-2025

  • Business
  • Khaleej Times

Airbus raises dividend payout range and confirms 2025 guidance

Airbus raised the upper range of its dividend payout target ahead of a business update on Wednesday and confirmed its guidance for 2025 as it looked to reassure investors about its future prospects. The company, which makes single-aisle jets used by passenger airlines, said it would target sustainable dividend growth and boost the upper end of its dividend payout range to 50%, from 30% to 40% previously. The world's largest planemaker reaffirmed its commitment to profitable growth and a cash conversion target of around 1 over a 5-year period, a metric that tracks how effectively it turns profit into free cash. Shares were up 3.8% in morning trading. Airbus' business update comes as the global aerospace industry gathers at the 2025 Paris Airshow, where manufacturers are showcasing their resilience with major deals despite global conflicts, U.S. tariffs, and supply chain strains. The company faces supply chain issues that have left almost 40 aircraft stranded without engines at its factories as shortages of cabin equipment and at power plants disrupt deliveries. Since early 2025, Airbus has experienced 40% less disruptions by delayed components at its production facilities, the group's head of operations for the commercial aircraft business, Florent Massou, said during the business update. However, he said that while easing engine bottlenecks would bring relief, strike-related disruptions at supplier sites deepens the vulnerability of the supply chain. Analysts fear this could lead to new bottlenecks as the sector navigates a delicate ramp-up of production. The company raised its 20-year jet demand forecast last week, telling investors the industry remains on course to weather ongoing trade tensions. Commercial segment chief Christian Scherer said Airbus would boost dual sourcing efforts to cushion against trade risks. Airbus said it remained "cautiously hopeful" of meeting its 2025 target of 820 deliveries, the CEO of its jetmaking arm said last week.

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