Durable goods orders fell for the first time in three months and business equipment purchases slipped for the second month in a row as commercial demand retreated from the rapid pace of the last two quarters.
Overall purchases for goods with a designed three year or more lifespan sank 3.7 percent in January after rising 2.6 percent in December, according to the Commerce Department on Tuesday. A drop of 2 percent had been forecast in the Reuters economic survey.
Business bookings, known officially as non-defense capital goods excluding aircraft and parts, fell 0.2 percent following the prior month's 0.6 percent decrease. It was the first back to back declines since April and May 2016. Orders had been predicted to increase 0.5 percent. Machine tool orders decreased 0.4 percent, electrical equipment and appliances dropped 0.8 percent.
Equipment purchases had advanced at a 11.4 percent annual pace in the fourth quarter of 2017, the best rate in three years.
Excluding the transportation sector, in practice the civilian aircraft orders of Boeing Company of Chicago, orders dropped 0.3 percent against a 0.4 percent expectation and a 0.7 percent gain in December.
Boeing said that it received 28 new aircraft orders in January barely 10 percent of December's prolific 265. Defense aircraft sales were down 46 percent, a reversal of the December's similar gain.
Shipments of these capital goods, the business spending statistic used by the government in its gross domestic product calculation rose 0.1 percent after December's upwardly revised 0.7 percent gain. Shipment had been forecast to increase 0.3 percent.
Chief Market Strategist
WorldWideMarkets Online Trading
Capital Goods ex Aircraft