US durable goods up, housing cools

Mixed news for the US economy.

Durable Goods Orders Up; Homes Sales Down
Orders for U.S. durable goods posted a larger-than-expected rise in July, but new home sales showed signs of buckling under the weight of higher interest rates, two government reports showed on Wednesday.

Orders for long-lasting goods gained 1.7 percent in July, their biggest monthly increase since March, the Commerce Department said. Orders aside from transportation were up a smaller 0.1 percent. June durables orders were revised up, to a 1.1 percent advance from a previously reported 0.9 percent jump.

The Commerce Department said July new home sales slid to 6.4 percent to a 1.134 million annual rate, their slowest pace since December. Analysts had expected a 1.29 million pace.

In a separate report, the Mortgage Bankers Association said new applications for U.S. home loans fell last week. The group's market index, a measure of mortgage activity, declined 6.3 percent last week to 646.3 from the previous week's 689.4.

The rise in durable goods orders is encouraging.

However, housing is a leading indicator of consumer spending, as consumers tend to buy goods for their new homes. A drop in housing bodes ill for consumer spending.