A hopeful increase in factory orders

One useful way to gauge the health of the U.S. manufacturing sector is tucked into the government’s monthly report on factory orders. It’s a simple measure with a complicated name: “Nondefense capital goods excluding aircraft.” These are orders for farm equipment, construction machinery, turbines, computers, trucks and office furniture, among other products. Economists say this barometer helps reveal whether companies are making investments that could eventually boost economic growth. So far this year, the gauge has increased a healthy 4.6 percent. For the past year, orders have been recovering from a U.S. manufacturing slump that intensified in 2015 as energy prices fell and a strong dollar hurt exports by making them costlier for foreign buyers. This measure may also become a key indicator of whether President Donald Trump’s planned tax cuts achieve their stated goals. Republicans have said the tax cuts would lead to greater spending on equipment, which, in turn, could increase worker productivity, job gains and economic growth.