Orders placed with US factories for business equipment rebounded in October, suggesting capital spending plans are holding up in the face of higher borrowing costs and broader economic uncertainty.

The value of core capital goods orders, a proxy for investment in equipment that excludes aircraft and military hardware, rose 0.7% last month after a downwardly revised 0.8% decline in September, Commerce Department figures showed Wednesday. The data aren’t adjusted for inflation.

Core capital goods shipments, a figure that is used to help calculate equipment investment in the government’s gross domestic product report, jumped 1.3%, the most since the start of the year. That suggests a solid start to fourth-quarter GDP. The preliminary estimate will be released in late January. 

The figures suggest companies are largely adhering to capital spending plans as they seek to improve productivity and help counter lingering cost pressures. At the same time, a Federal Reserve that’s poised to deliver more interest rate hikes in coming months risks causing a pullback in investment.

Bookings for all durable goods -- items meant to last at least three years -- rose 1% in October, the most in four months and bolstered by transportation equipment and military aircraft. Excluding transportation equipment, durable goods orders rose 0.5% after a sharp drop the previous month.

American manufacturers have benefited from largely resilient consumer spending for merchandise at home, but a deteriorating global economic backdrop will restrain overseas demand. 

The median estimates in a Bloomberg survey of economists was for core capital goods orders to flatline and overall bookings for durable goods to rise 0.4%.

Manufacturing Surveys

Survey data in recent weeks have generally pointed to a loss of momentum. The Institute for Supply Management’s gauge of factory activity neared stagnation in October as orders contracted. 

Several regional Fed bank manufacturing surveys pointed to shrinking business activity last month, a downshift that lingered into November in areas like those covered by the Philadelphia and Richmond Fed banks.

The Commerce Department’s report showed bookings for commercial aircraft, which are volatile from month to month, increased 7.4%. Boeing Co. reported 122 orders in October, up from 96 in September. While often helpful to compare the two, aircraft orders are volatile and the government data don’t always correlate with the planemaker’s monthly figures.

Orders for military aircraft, which are volatile on a monthly basis, increased 21.7%, recovering much of the prior month’s drop. Total defense capital goods rose.

The report also showed unfilled orders for all durable goods increased, while inventories edged up.