WASHINGTON – New manufacturers’ orders for durable goods fell a seasonally adjusted $11.2 billion or 4.9 percent in August to $219.3 billion, after rising 5.9 percent in July and 1.9 percent in June, according to the preliminary report released today by the U.S. Census Bureau’s Manufacturing and Construction Division.
Total new manufacturers’ orders in August– including durable and non-durable goods – fell $14.4 billion or 3.3 percent to $420.7 billion, after rising a smaller-than-previously-estimated 3.4 percent in July, the bureau said. The decline was sharper than the 2.8-percent median prediction from a Bloomberg News survey of 71 economists. (Their forecasts ranged from a decline of 3.5 percent to an increase of 1.1 percent.)
The decline was led by a 40-percent drop in commercial aircraft orders, which had risen 13 percent in July; and an 8.6-percent decline in orders for automobiles and parts, which was the sharpest since 2002. “The industry is weighed down by energy prices and housing and it is showing up in vehicle sales,” General Motors Corp. industry analyst Paul Ballew told Bloomberg News this week, adding: “The overall U.S. economy has softened and is likely to soften further as this housing correction plays itself through.”
Orders excluding airplanes and other transportation equipment fell 1.7 percent, erasing July’s 1.7-percent gain. Excluding defense, new orders fell 5.9 percent.
Meanwhile, unfilled orders for durable and nondurable goods rose $9.1 billion or 1.2 percent to $763.5 billion, their highest level since at least 1992, after increasing 2.3 percent in July. Unfilled orders have increased in 27 of the past 28 months, the bureau noted.
“The volatility in financial markets in recent months probably introduced an element of caution in ordering,” Michael Moran, chief economist at Daiwa Securities America Inc. in New York, told Bloomberg News.
Additional information, including the Preliminary Report on Manufacturers’ Shipments, Inventories and Orders (M3), is available from the U.S. Commerce Department’s Bureau of the Census, Manufacturing and Construction Division, at www.census.gov/m3.
