U.S. business-equipment orders post third drop in four months

ORDERS PLACED with United States factories for business equipment fell in February for the third time in four months. / BLOOMBERG FILE PHOTO/SERGIO FLORES
ORDERS PLACED with United States factories for business equipment fell in February for the third time in four months. / BLOOMBERG FILE PHOTO/SERGIO FLORES

NEW YORK – Orders placed with United States factories for business equipment fell in February for the third time in four months, suggesting corporate investment remains subdued amid a slowing global economy and uncertainty over the trade war with China.

Non-military capital-goods orders excluding aircraft – a proxy for business investment – fell 0.1 percent, after an upwardly revised 0.9 percent increase the prior month, according to Commerce Department figures released Tuesday. The median forecast in a Bloomberg survey called for a 0.1 percent gain. The broader measure of bookings for all durable goods, or items meant to last at least three years, dropped by less than expected.

Key insights

The data add to signs that U.S. economic growth is cooling from last year as slowing expansion in China and Europe weighs on corporate America. At the same time, a separate report Monday showed a factory index from the Institute for Supply Management rebounded in March from a two-year low. Some figures that are used to calculate gross domestic product were slightly more encouraging: Shipments of non-military capital goods excluding aircraft were unchanged, compared with the Bloomberg survey median estimate of a 0.1 percent decline, and the prior month was revised upward. The headline durable-goods figures reflect a 31.1 percent plunge in orders for civilian aircraft and parts, a category that tends to be volatile. Separate data showed Boeing Co.’s aircraft orders fell in February from the prior month.

- Advertisement -

Get more

February’s three-month annualized gain in business-equipment shipments rose to 3.3 percent from 2.2 percent, while the decline in orders eased to 3.4 percent from 4.9 percent. Excluding transportation equipment, durable-goods orders rose 0.1 percent, matching analyst projections, after a 0.1 percent decrease. Defense capital-goods orders fell 3.4 percent in February. Categories posting gains in orders included electrical equipment, primary metals and fabricated metal products. Sectors with declines included motor vehicles and parts, computers and electronic products and machinery. Durable goods inventories rose 0.3 percent. Analysts look at inventories to help refine estimates for GDP.

Reade Pickert is a reporter for Bloomberg News.

No posts to display