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Ahead of the Bell: Durable Goods

June 24, 2016 GMT
In this April 6, 2016, photograph, a technician conducts a final inspection before a finished Altima sedan is rolled out at the Nissan Canton Vehicle Assembly Plant in Canton, Miss. On Friday, June 24, 2016, the Commerce Department releases its May report on durable goods. (AP Photo/Rogelio V. Solis)
In this April 6, 2016, photograph, a technician conducts a final inspection before a finished Altima sedan is rolled out at the Nissan Canton Vehicle Assembly Plant in Canton, Miss. On Friday, June 24, 2016, the Commerce Department releases its May report on durable goods. (AP Photo/Rogelio V. Solis)
In this April 6, 2016, photograph, a technician conducts a final inspection before a finished Altima sedan is rolled out at the Nissan Canton Vehicle Assembly Plant in Canton, Miss. On Friday, June 24, 2016, the Commerce Department releases its May report on durable goods. (AP Photo/Rogelio V. Solis)

WASHINGTON (AP) — The Commerce Department releases its May report on durable goods at 8:30 a.m. Eastern time Friday.

REVERSAL LIKELY: Economists forecast that orders to U.S. factories for long-lasting manufactured goods fell 0.8 percent in May after two straight months of gains, according to a survey by the data firm FactSet.

MIXED SIGNALS: In April, durable goods orders rose 3.4 percent on top of a 1.9 percent gain in March. But the April gain was less impressive than it looked. It was largely driven by a 65 percent jump in orders for commercial aircraft, which bounce around from month to month. And a key category that tracks business investment fell for the third straight month.

UNCERTAINTY: American manufacturing has been hurt by cutbacks in the energy industry, a response to low oil and gas prices, and by a strong dollar, which makes American products costlier in foreign markets. Economists also say businesses may be reluctant to place orders for durable goods — items such as cars and dishwashers that are meant to last at least three years — because of uncertainty over the U.S. presidential election.

Last week, the Federal Reserve reported that U.S. industrial output fell 0.4 percent in May from April, pulled down by a 4.4 percent drop in auto production.