U.S. durable-goods orders shot up in March as demand for big-ticket items such as aircraft and machinery was widespread.

Orders for long-lasting manufactured items jumped 3.4% to US$192.7 billion last month, the Commerce Department reported today. Nondefense capital goods excluding aircraft rose 2.4%.

February orders rose a revised 3.8%, after initially being recorded as a 2.5% gain. In January, demand dropped 2.6%.

Economists, who had expected March orders to rise just 0.7%, said the report was a good indication that the economy will continue to grow this year and that business spending has improved.

Today’s durable-goods report showed broad-based increase in demand for big-ticket items.

Transportation orders advanced by 3.6%, following February’s 11% surge. Nondefense aircraft orders increased 11.7%, while defense aircraft demand dropped 27.7%. Orders for cars and parts advanced 3.6%. Excluding transportation when calculating demand for all durable goods, overall orders climbed by 3.3% — the 10th increase in 11 months.

Capital-goods orders rose by 0.9% after rising 6.1% the prior month. There was a 6.1% drop in demand for defense-related items. Excluding defense orders from calculations, overall durable-goods orders went up by 3.8%.

Orders rose by 2.1% for nondefense capital goods, which are meant to last at least 10 years and act as an indicator of business spending. Demand for such goods jumped 4.5% in February. Nondefense capital goods excluding aircraft demand for February rose 2.8%, revised higher from a previously reported 1.1% increase.

Orders for computers and electronic products increased by 0.2% in March. Machinery orders rose by 3.1%. Demand for primary metals advanced 7.2%. Fabricated metal products climbed 5.2%. Orders for electrical equipment and appliances increased by 0.8%.

Durable-goods inventories edged up by 0.1%, unfilled orders rose by 0.8%, and shipments increased 3.2%.

“Substantial upward revisions to the prior month lifted the impression of solid, accelerating Q1 GDP growth,” says BMO Nesbitt Burns. “New orders and shipments of durable goods are starting to match up more closely with the boom levels portrayed by the ISM survey’s run of 60+ readings. So, the results look like the real thing, despite the durable goods report’s justified reputation for volatility.”