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Demand for big-ticket U.S.-made goods plunged in May, as orders for metals, heavy machinery and even aircraft all skidded.
The orders for so-called "durable" goods dropped by 2.8% last month – the biggest decline in four months, and far more than the 1% decline economists had projected. This report is considered a crucial indicator of the health of the U.S. factory sector. (For full text of the government report, click here.
The Commerce Department said that the weakness was led by a huge 22.7% drop in orders for commercial aircraft, although with the long lead times those orders entail, aircraft-sales statistics can be very volatile from month to month. But the government report noted that orders were down for a wide range of other products, including electronic gear, factory machinery, and primary metals.
While some economists discounted the weak figures, noting that past months' reports were subsequently revised upward, others said the report doesn't bode well for hopes that stepped-up business spending will help pull the U.S. economy out of a malaise that's lingered for a year.