Durable goods orders rose meekly in March

Orders for long-lasting goods, such as cars, airplanes and computers, rose less than expected in March as weak exports and low oil prices continued to hamper business demand and manufacturing output.

Also, a key category that reflects business investment was flat.

So-called durable goods orders to factories edged up 0.8%, half the 1.9% rise economists expected. And February’s 2.8% fall was revised to a 3.1% drop.

Capital goods orders excluding aircraft and defense — considered a proxy for business investment — was unchanged. Economists expected a 0.6% increase. And a 1.8% slide in February was revised to a 2.7% decline.

Manufactures have been struggling since summer 2014 amid a listless global economy and a strong dollar that have pummeled exports and low oil prices that have led crude producers to throttle back drilling and investment in pipes and other equipment. While factory output slipped in March, the closely watched measure of manufacturing activity showed expansion for the first time in six months, raising hopes that the industry may be stabilizing following the recent drop in the dollar and rise in oil prices.

In March, aircraft demand, which is volatile, helped turn what would have been an overall decline in orders into a slight gain. Defense-related aircraft orders jumped 66%, more than offsetting a 5.7% drop in commercial aircraft.

Motor vehicles orders, which generally have been strong the past year, fell 3%. Orders also slipped 6.6% for computers, 3% for electrical equipment and appliances and 1.6% for fabricated metals.

Factory machinery orders ticked up 0.5%, partly reversing a sharp drop the previous month. And orders for primary metals rose 0.8%.

"We expect that the headwinds constraining growth, namely weak foreign demand, the strong dollar, bloated inventories, and low oil prices, will remain steadfast for most of this year, limiting the potential upside to real GDP growth in 2016," Oxford Economics wrote in a note to clients.