After reporting a sharp increase in new orders for U.S. manufactured durable goods in the previous month, the Commerce Department released a report on Wednesday showing durable goods orders pulled back by much less than expected in the month of September.
The Commerce Department said durable goods orders fell by 0.4 percent in September after jumping by a downwardly revised 1.3 percent in August.
Economists had expected durable goods orders to slump by 1.1 percent compared to the 1.8 percent spike that had been reported for the previous month.
The pullback in durable goods orders came as orders for transportation equipment tumbled by 2.3 percent in September after surging by 3.8 percent in August.
Orders for non-defense aircraft and parts led the way lower, plunging by 27.9 percent in September after soaring by 63.9 in August. Orders for motor vehicles and parts also slumped by 2.9 percent.
Excluding the steep drop in orders for transportation equipment, durable goods orders climbed by 0.4 percent in September after rising by 0.3 percent in August. The increase matched economist estimates.
Increases in orders for machinery, fabricated metal products and primary metals were partly offset by decreases in orders for electrical equipment, appliances and components and computers and electronic products.
Orders for non-defense capital goods excluding aircraft, a closely watched indicator of business spending, climbed by 0.8 percent in September after rising by 0.5 percent in August.
“Businesses face a rare conundrum today in which major supply chain disruptions are making it very hard to meet robust demand,” said Oren Klachkin, Lead U.S. Economist at Oxford Economics.
He added, “Our U.S. supply chain tracker shows that stress continues to increase, so these challenges aren’t likely to abate in the immediate future.”
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