Orders for big-ticket manufactured goods fell for the second consecutive month in September, the latest sign of uneven improvement in the economy.
Continue Reading Below
Purchases of durable goods--products like airplanes, cars, and heavy machinery that are designed to last at least three years--fell by 1.3% in September from the prior month to a seasonally adjusted $241.63 billion, the Commerce Department said Tuesday. Economists surveyed by The Wall Street Journal had forecast orders rose by 0.7% in September.
Excluding the volatile transportation category, orders fell 0.2%. Excluding defense goods, orders fell 1.5%.
Business spending emerged from a period of greater than usual volatility over the summer. It signaled that concerns over slowing global growth could be weighing on business confidence.
Durable goods orders fell 18.3% in August, slightly less than a previously reported 18.4% decline. They rose 22.5% in July. The large swing was caused by record orders reported by aircraft manufacturing giant Boeing Co. (BA) in July.
More recent data from Boeing showed it had orders for 122 aircraft in September and 107 in August, down from 324 in July.
Continue Reading Below
Another key measure of business investment also fell in September. Orders for nondefense capital goods excluding aircraft, a proxy for spending on equipment and software, fell 1.7%.
This closely watched category had risen 0.3% in August and fell 0.1% in July.
Other recent data has pointed to strengthening demand for manufactured products. U.S. industrial production--a broad gauge of output from factories, utilities and mines--rose 1% in September thanks to increased electricity production as well as a rebound in manufacturing output.
Strong business spending helped lift the broader economy in the second quarter and is thought to have done so again in the third quarter. The Commerce Department will release its first estimate of gross-domestic-product growth for the July-to-September period on Thursday.
Tuesday's report showed that durable goods orders for the first nine months of the year were up 7.6% from the same period a year earlier.
Macroeconomic Advisers estimates GDP rose at a seasonally adjusted 3.5% rate in the third quarter. That would be less than the second quarter's 4.6% increase but still an above-average gain in the current expansion.
The Commerce Department's durable goods orders report can be found at http://www.census.gov/manufacturing/m3.