Fewer bookings for autos, planes triggers third drop in four months
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) — Orders for long-lasting goods fell in September for the third time in four months, mainly because of lower demand for autos and commercial aircraft, the U.S. government reported Wednesday.
Bookings for U.S.-made products designed to last at least three years fell by 0.8% last month, the Commerce Department said. Economists surveyed by MarketWatch had expected orders for durable goods to show a 1.0% decrease.
Transportation orders slumped 7.5% to account for virtually the entire decline. Demand for autos likely leveled off after a busy August and as Boeing Co. BA +3.66% saw fewer orders for commercial jetliners.
Excluding transportation, however, orders climbed 1.7% in September. Demand increased for computers, primary metals, fabricated metals, heavy machinery and electrical equipment.
Also, orders for a closely watched category known as core capital goods rose an even sharper 2.4%. That category omits transportation and defense since demand for autos, planes and weapons are uneven and can change sharply from month to month.
Since orders bounce around, economists tend to look at a longer average to gauge current trends. During the third quarter, core capital orders rose an average of 0.9% each month.
Shipments of core capital-equipment goods, meanwhile, fell 0.9% last month. The government uses core shipments to help calculate quarterly growth rates for the economy.
Based on the most recent estimates, the U.S. economy likely grew 2.8% in the third quarter, according to a MarketWatch survey of economists. The government’s first estimate of growth in gross domestic product will be issued Thursday.
Shipments of overall durable goods fell 0.7% last month, while inventories rose 0.1%.
Orders in August were unchanged at a 0.1% decline.
Jeffry Bartash is a reporter for MarketWatch in Washington.
