April U.S. durable goods orders sunk most since October

on Wednesday, May 25, 2011

April U.S. durable goods orders sunk most since OctoberThe U.S. manufacturing sector has helped propel the nascent economic recovery, but according to newly released data that expansion could be starting to slow.

A Commerce Department report issued this week stated that orders for U.S. durable goods fell more than forecast in April. The fall, however, was largely attributed to a decline in demand for aircrafts and supply chain disruptions emanating from the crisis in Japan.

Still, the 3.6 percent fall in bookings for goods meant to last at least three years represented the largest drop since October. In March, the index jumped unexpectedly by 4.4 percent, beating expectations.

Though Boeing and carmakers showed declines in the month, John Deere and General Electric experienced an uptick in overseas demand, leading many industry watchers to assert that the manufacturing industry will continue to lead the overall economic recovery.

"Manufacturing is likely to moderate from the explosive pace of growth in the past few months," said Pierpoint Securities chief economist Stephen Stanley. "Consumer demand and investment demand are both doing well right now."

A Bloomberg Survey of analysts had forecast a 0.5 percent rise.

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