Orders for durable goods decline
February marks first drop following 9 consecutive months of gains.
WASHINGTON — Orders to U.S. factories for big-ticket manufactured goods slumped 1.1% in February with demand in a key sector that tracks business investment also dropping.
Orders had been rising for nine consecutive months, including a sizable 3.5% jump in January, according to the Commerce Department.
The size of the drop surprised economists, though it is likely that there was significant disruption from severe winter storms that hit much of the country last month, on top of ongoing supply-chain problems.
The category that covers business investment dropped 0.8% in February following solid gains of 0.6% in January and 1.5% in December.
The volatile transportation sector fell 1.6% with demand for commercial aircraft, a sector plagued by the huge drop in air travel during the pandemic, shooting up 103%. Contributing was beleaguered manufacturer Boeing, which for the first time since December 2019 booked positive net orders.
But orders for autos and auto parts slumped 8.7% with numerous plants shutdown due to a global shortage of semiconductors, a critical component used in cars and trucks.
The 0.8% decline in demand for nondefense capital goods excluding aircraft, the category that serves as a proxy for business investment plans, was blamed on weather disruptions. Economists predicted a rebound in coming months as businesses boost their
The Commerce Department reported Wednesday that orders for durable goods declined last month after nine consecutive monthly gains. investment spending in response to falling virus cases and President Joe Biden’s $1.9 trillion support package.