Washington, DC, United States (4E) – Orders for big-ticket manufactured goods in the U.S. fell in December, which reflects the cautious spending by firms that is holding back the U.S. recovery.
New orders for durable goods, which include refrigerators and cars made to last more than three years, dropped by 4.3 percent in December from November to $229.3bn, according to the Commerce Department report released Tuesday. The decline, the second in the last three months, represents the biggest fall since July.
The weak performance was a result of a lower demand for civilian aircraft, which is considered a volatile segment. Without the transportation sector, orders for durable goods dropped 1.6 percent, the biggest fall since March.
For December, economists polled by the Dow Jones Newswires had predicted a 1.5 percent rise in orders for durable goods.
The data reflects the cautious spending by consumers and businesses, despite signs of a rebound in the U.S. economy gained momentum toward the end of 2013. The report also reflected weaker demand in November than previously predicted, with the latest result showing a 2.6 percent rise in overall durable-goods orders that month, from a previous estimate of 3.4 percent gain.
Orders for nondefense capital goods excluding aircraft, a key gauge of business investment, fell in December, declining for the fourth time in the last six months. The proxy for spending on equipment and software dropped by 1.3 percent in December, a reversal from the 2.6 percent increase in November.