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Data points to slowing manufacturing activity

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New orders for U.S. manufactured goods posted their largest drop in six months in April after a steep fall in demand for transportation equipment, suggesting some cooling in factory activity, Reuters reported.

Durable goods orders declined 3.6 percent last month, worse than economists’ expectations for a 2.2 percent fall. March’s orders were revised up to a 4.4 percent rise from a previously reported 4.1 percent increase, the Commerce Department said on Wednesday.

Though durable goods orders are extremely volatile, the report added to a raft of recent data suggesting that the loss of economic growth momentum encountered as the year started persisted into the early part of the second quarter. It also underscored the magnitude of the impact of supply chain disruptions from the Japanese earthquake on the economy.

“It is clear, not only from this report but from others, that the U.S. economy is encountering its fair share of speed bumps,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto.

Orders last month were pulled down by a 4.5 percent fall in motor vehicle bookings, the largest decline since August, tracking an 8.9 percent dive in auto production during that month.

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