US durable good orders fall sharply in April

Business | 24 May 2019 9:36 pm

Orders to U.S. factories for large manufactured goods fell sharply last month, pulled down by lower demand for commercial aircraft and cars.

The Commerce Department said Friday that orders for durable goods — or items meant to last at least three years — fell 2.1 percent, after rising by 1.7 percent in March. Orders also fell steeply in February.

Aircraft orders, typically a volatile category, plummeted by 25.1 percent, after a more modest gain of 7.8 percent in the previous month. Orders for cars and auto parts fell by 3.4 percent, the biggest drop in nearly a year.

Excluding transportation items, orders were unchanged. But a category that tracks business investment declined by 0.9 percent, the most since December. Demand for communications equipment and steel, aluminum and other metals fell, while orders for machinery barely rose.

The data suggest companies are spending less on big-ticket items, likely in part because of the uncertainties raised by the U.S.-China trade war. Americans are also purchasing fewer cars, forcing automakers to pare back activity. Higher interest rates and additional competition from late-model used cars has reduced sales.

Manufacturing output has weakened in the past year, held back by trade tensions and slower global growth. Factory output fell in April, according to a report by the Federal Reserve. Factory production has increased just 0.9 percent in the past 12 months.-AP

 

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