Orders to US factories plung in August on planes and computersSubmitted by emalvini on Thu, 10/04/2012 - 11:03
Orders to US factories plung in August on planes and computers
By Lorraine Woellert
Oct 4, 2012 7:33 AM PT
Orders placed with U.S. factories fell in August by the most in more than three years, signaling that slowdowns in business investment and exports restrained the economic expansion.
The 5.2 percent decrease in bookings was the biggest since January 2009 and followed a revised 2.6 percent increase in July, the Commerce Department said today in Washington. The median forecast of economists in a Bloomberg News survey called for a decline of 5.9 percent. Demand for durable goods dropped 13.2 percent, the same as reported last week, while shipments of non-durables, which includes such things as petroleum and chemicals and often reflect swings in price, climbed 2.2 percent.
Factories are feeling the effects of Europe’s debt crisis and a slowdown in China and other Asian markets. In the U.S., concerns about a fiscal cliff of tax increases and government spending cuts set for January also are putting the brakes on business investment, which has been a mainstay of the expansion.
“These data indicate that the recent softness in manufacturing activity and capital spending is likely to continue, at least for several more months,” Steven Wood, president of Insight Economics LLC in Danville, California, said in a note to clients.