WASHINGTON, Sept 6 — New orders for US-made goods fell slightly more than expected in July, weighed down by weak demand for aircraft, but signs of a pickup in business spending suggested that the manufacturing sector remained on solid ground.
Factory goods orders dropped 0.8 per cent, the Commerce Department said today. Data for June was revised slightly down to show factory orders rising 0.6 per cent instead of the previously reported 0.7 per cent increase.
Economists polled by Reuters had forecast factory orders falling 0.6 per cent in July. Orders increased 8.3 per cent on a year-on-year basis in July.
Despite the drop in factory orders in July, manufacturing, which accounts for about 12 per cent of the US economy, remains strong. An Institute for Supply Management survey of manufacturers published on Tuesday showed factory activity accelerated to more than a 14-year high in August.
But there are concerns an escalating trade war between United States and China could hurt business confidence and undercut capital spending. A strong dollar and worker shortages are also seen slowing momentum in the manufacturing sector.
In July, orders for transportation equipment fell 5.2 per cent, dragged down by a 35.4 per cent plunge in the volatile orders for civilian aircraft and parts. Orders for defence aircraft and parts tumbled 34.4 per cent in July. Transportation orders rose 2.0 per cent in June.
Orders for motor vehicles increased 1.3 per cent in July. There were increases in orders for machinery, primary metals and computers and electronic products. Orders for fabricated metal products fell as did those for electronic equipment, appliances and components.
The Commerce Department also said July orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans, jumped 1.6 per cent instead of increasing 1.4 per cent as reported last month. Orders for these so-called core capital goods rose 0.8 per cent in June.
Shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, increased 1.0 per cent in July instead of climbing 0.9 per cent as reported last month.
Core capital goods shipments rose 1.0 per cent in June. Business spending on equipment slowed in the second quarter after growing robustly since the first quarter of 2017. — Reuters
Source: The Malay Mail Online