Durable goods orders fell 1.7% in February, with nondefense capital goods orders excluding aircraft falling 2.6%, according to the U.S. Census Bureau. More details here.
“A scenario of economic uncertainty and tightened credit availability, amid high and rising costs for energy and other commodities, is not a conducive environment for business investment in capital equipment,”said Daniel Meckstroth, chief economist for the Manufacturers Alliance/MAPI.
“… Manufacturing capacity utilization is declining, and the indicator of slack in the nonindustrial economy, the unemployment rate, is rising. The need for domestic capacity is waning. An important support for the industrial equipment sector is that exports are booming and imports are weak. A declining value of the U.S. dollar is providing countercyclical foreign demand to compensate for weak domestic needs for durable goods.”