US Factory Orders Fell in February

New orders for U.S. factory goods fell in February and business spending on capital goods was much weaker than initially thought, the latest indications that economic growth remained sluggish in the first quarter.

The Commerce Department said on Monday new orders for manufactured goods declined 1.7 percent as demand fell broadly, reversing January’s downwardly revised 1.2 percent increase.

Orders have declined in 14 of the last 19 months.

February’s drop in factory orders was in line with economists’ expectations. Orders were previously reported to have increased 1.6 percent in January.

The report added to weak consumer spending and trade data in suggesting economic growth failed to pick up at the turn of the year after slowing to a 1.4 percent annualized pace in the fourth quarter.

Manufacturing, which accounts for about 12 percent of the economy, has been pressured by a strong dollar and weak global demand, which have undermined exports of factory goods, and efforts by businesses to reduce an inventory overhang.

The sector has also been slammed by investment cuts by energy firms as they adjust to reduced profits from cheap oil.

But the worst of the factory slump appears to be over, with a survey last week showing manufacturing activity expanded in March for the first time in six months.

via Reuters

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.