Thursday, October 04 15:27:21
Demand for U.S. factory goods in August fell by the most since January 2009, but the second straight month of gains in orders outside transportation hinted at a less rapid loss of momentum in manufacturing activity.
The Commerce Department said new orders for manufactured goods tumbled 5.2 percent - the biggest drop since the recession - dragged down by a slump in demand for transportation equipment that was telegraphed in last week's report on orders for long-lasting manufactured goods.
Factory orders had risen 2.8 percent in July and economists had expected them to drop 5.8 percent in August. Excluding transportation, orders rose 0.7 percent in August after rising by the same margin the prior month.
Manufacturing has carried the economic recovery and while activity has cooled significantly in recent months, there are so far little signs of a hard landing.
The Institute for Supply Management's index of national manufacturing activity last month climbed above the 50 mark - which separates contraction from expansion - after three straight months below 50.
The Commerce Department report showed orders for transportation equipment tumbled 34.9 percent in August on sharply weak orders for civilian and defense aircraft. (C ) Reuters