Durable Goods Orders Down 3.8% in June

New orders for durable goods dropped by 3.8% in June to $166.6 billion, marking the largest decline in seven months, the Commerce Department said Thursday.

A drop in durable orders, which are manufactured goods expected to last at least three years, reduces the amount of goods produced by U.S. factories for shipment by truck.

The decline followed a revised 0.6% rise in May. Analysts were expecting an increase of 0.9% for the month, Bloomberg reported.

Excluding transportation equipment, Commerce said orders fell 3.1% in June after rising 1% the month before. Orders for computers, machinery, automobiles and communications equipment all declined in June. Orders for motor vehicles fell 3.4%.

Only the defense industry saw an increased demand in orders during June, the report said.

Inventories of durable goods fell 0.5% last month, the 17th straight decrease, but shipments dropped 1.4%.

Bloomberg said businesses have hesitated to invest in equipment and software as concerns over the economic recovery grow due to the stock market slide.

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