Orders for U.S. Business Gear Stall After Two-Month Gain
by Victoria Stilwell
September 24, 2015 — 8:33 AM EDT
The momentum in orders for business equipment stalled in August following gains the prior two months as U.S. investment took a breather amid volatility in financial markets and concerns that global growth is slowing.
Bookings for non-military capital goods excluding aircraft fell 0.2 percent last month after rising 2.1 percent in July, data from the Commerce Department showed Thursday in Washington. Orders for all durable goods -- items meant to last at least three years -- dropped 2 percent, reflecting declines in defense and aircraft.
The relatively steady reading in capital goods bookings following the best back-to-back gains in more than a year signals companies waiting to assess prospects for U.S. demand as global growth slows and financial markets turn volatile. A strong American consumer, powered by more jobs, growing incomes and low inflation, will be needed to help support the outlook for growth in the second half of the year.
“The net of the last couple months is still up a little bit, and it does look like both capital goods orders and shipments are on track for a gain in the third quarter,” said Jim O’Sullivan, chief U.S. economist at High Frequency Economics Ltd. in Valhalla, New York, and the best forecaster of durable goods over the past two years, according to data compiled by Bloomberg. Still, “when you look at the U.S. economy right now, the export-oriented manufacturing sector does look quite weak.”
more:
http://www.bloomberg.com/news/articles/2015-09-24/durable-goods-orders-in-u-s-decreased-2-in-august
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