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NEW YORK (Reuters) - The U.S. economy is on track to grow at a 1.0 percent annualized pace in the first quarter due to surprisingly strong data on durable goods orders in February, the Atlanta Federal Reserve's GDP Now forecast model showed on Friday.
The latest first-quarter gross domestic product estimate was faster than the 0.9 percent growth rate calculated on March 16, the Atlanta Fed said on its website.
Still, the latest estimate remained well below the Atlanta Fed's initial reading of 2.3 percent back on Jan. 30.
The Commerce Department said earlier Friday durable goods orders grew 1.7 percent last month, above the 1.2 percent increase forecast of analysts polled by Reuters. This compared with an upwardly revised 2.3 percent increase in January.
In the wake of the latest durables goods reading, the Atlanta Fed raised its growth forecast on non-residential equipment investment to 7.8 percent from 7.3 percent.
The regional central bank also reduced its estimated drag on first-quarter GDP from inventory investment to 0.77 percent from 0.87 percent following last week's report on industrial output in February.
Reporting by Richard Leong; Editing by Chizu Nomiyama and Bernadette Baum