Economy Ends 2013 on Strong Note With Surge in Durable Goods Orders

Orders for long-lasting goods surged 3.5 percent in November.

Traders work the floor of the New York Stock Exchange as the Dow Jones Industrial Average closed up 42 points at 16,221 points. on Dec. 20, 2013, in New York City.
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The economy is ending the year in a holiday spirit, with orders for long-lasting manufactured goods surging in November, the government reported Tuesday.

Gains came across the board, with the Commerce Department saying orders for non-defense capital goods, which economists consider a harbinger of business spending plans, rising 4.5 percent. That is the largest increase since January.

"It's a holly, jolly data Christmas for the economy as all signs point to an accelerating economy," said economist Joel Naroff in an email to clients.

[READ: GDP Surprises Again, Up by 4.1 Percent in Third Quarter]

The data come barely a week after the Federal Reserve Board decided to trim its monthly asset purchases by $10 billion, from $85 billion a month to $75 billion, citing improving economic conditions. Third-quarter GDP was also recently revised upward to 4.1 percent in yet another sign the economy is gaining steam approaching 2014.

"Things seemed to have turned now," a senior economist at Wells Fargo Securities in Charlotte, N.C., told Reuters. 

Many economists had suggested that businesses were taking a wait-and-see attitude toward spending as long as Congress remained unsettled about a budget and amid the continued threat of a government shutdown in the new year. That ended with the recent bipartisan deal to enact a budget that lasts until 2015.

A booming stock market, which rose on the durable goods news in a shortened holiday session, robust home sales and increasingly positive consumer sentiment also add to the economic good tidings at year-end. Perhaps the only downer are reports that holiday spending is only modest this year so far.

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