WASHINGTON—New orders for key U.S.–manufactured capital goods increased by the most in five months in January while shipments of those so-called core goods rebounded, suggesting that business spending on equipment picked up at the start of the first quarter.
Some of the larger-than-expected rise in core capital goods orders reported by the Commerce Department on Monday, which ended two straight monthly declines, likely reflected higher prices last month. It joined solid consumer spending and robust labor market data in painting an upbeat picture of the economy.
The string of strong data has raised the risk that the Federal Reserve could hike interest rates to a higher level than currently estimated….