- Manufacturing, which accounts for about 12pc of the economy, is losing momentum as the stimulus from last year’s $1.5 trillion tax cut package fades
WASHINGTON: New orders for US-made goods rose less than expected in January and shipments fell for a fourth straight month, offering more evidence of a slowdown in manufacturing activity.
Factory goods orders edged up 0.1pc, the Commerce Department said on Tuesday, held back by decreases in orders for computers and electronic products, after rising by the same margin in December.
There were also declines in demand for primary metals and fabricated metal products.
Economists polled by Reuters had forecast factory orders rising 0.3pc in January. Factory orders increased 3.8pc compared to January 2018.
Shipments of factory goods fell 0.4pc after dropping 0.2pc in December. They have now declined for four consecutive months, the longest streak since mid-2015.
Factory orders are likely to remain soft as unfilled orders rose only 0.1pc in January after dropping for three straight months.
Stocks at manufacturers jumped 0.5pc in January after edging up 0.1pc in the prior month.
The release of the report was delayed by a 35-day partial shutdown of the federal government that ended on Jan 25 US financial markets were little moved by the data.
Reports last Friday showed manufacturing output fell for a second straight month in February and factory activity in New York state hit nearly a two-year low this month.
Manufacturing, which accounts for about 12pc of the economy, is losing momentum as the stimulus from last year’s $1.5 trillion tax cut package fades. Activity is also being hampered by a trade war between the United States and China as well as by last year’s surge in the dollar and softening global economic growth, which are hurting exports.
In January, orders for machinery rose 1.5pc after falling 0.4pc in December. Orders for mining, oil field and gas field machinery fell 2.7pc after tumbling 8.2pc in December.
Orders for electrical equipment, appliances and components rebounded 1.4pc after dropping 0.3pc in December. Computers and electronic products orders fell 0.9pc after decreasing 0.4pc in December.
Orders for primary metals declined 2.0pc and fabricated metal products orders fell 0.6pc. Transportation equipment orders increased 1.2pc in January, slowing from the prior month’s 3.2pc rise.
Orders for civilian aircraft and parts increased 15.6pc in January. Motor vehicles and parts orders gained 0.4pc.
The Commerce Department also said January orders for non-defence capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, rose 0.8pc as reported last week. Orders for these so-called core capital goods dropped 0.8pc in December.
Shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, also increased 0.8pc in January as previously reported. Core capital goods shipments edged up 0.1pc in December.