US factory orders rebound as expected in August

WASHINGTON (Reuters) -New orders for U.S.-manufactured goods rebounded in August, though business spending on equipment was not as strong as initially thought.

Factory orders increased 1.4% after an unrevised 1.3% decline in July, the Commerce Department's Census Bureau said on Tuesday. The increase was in line with economists' expectations. Orders rose 3.3% on a year-on-year basis in August.

The report, initially due on October 2, was delayed by a recently ended record 43-day shutdown of the federal government.

Manufacturing, which accounts for about 10.2% of the economy, is struggling with the fallout from tariffs on imports. The Institute for Supply Management's manufacturing PMI has contracted for eight straight months.

The government also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 0.4% instead of 0.6% as estimated in September.

Shipments of these so-called core capital goods dropped 0.4% rather than 0.3% as reported in September.

(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

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