New orders for long-lasting US made goods fell 0.9 per cent last month as demand for vehicles and civilian aircraft fell, but businesses boosted orders for capital goods, the government said today.
A 5.3 per cent plunge in transportation equipment orders lay behind the drop in demand for durable goods - expensive manufactured items made to last three years or more.
It was the first decline in durable goods orders since October, the Commerce Department said. Excluding the often-volatile transport category, however, durable goods orders climbed 0.8 per cent.
Wall Street economists had expected durable goods order to rise 0.1 per cent with orders outside the volatile transport category up a sharper 0.4 per cent.
The report also showed defence-capital goods orders dropped a sharp 9.8 per cent, despite a massive 56.9 per cent advance in military aircraft orders.
Even with defence orders stripped out, demand for durable goods was still down 0.8 per cent, the first drop in three months. The report offered generally upbeat news on the business-spending outlook.
Civilian capital goods orders, excluding aircraft - a figure economists look to as a proxy for future business spending plans - grew a healthy 2.9 per cent.
While a 3.8 per cent drop in motor vehicle orders and a 27.1 per cent plunge in civilian aircraft demand pulled overall durable goods orders down, orders for computers and communications equipment also fell.
But orders for primary metals, fabricated metal products and machinery all posted gains.