Durable Goods Orders Fell 0.6% in August

The number of orders placed for new durable goods in the United States fell 0.6% in August, following up a revised 8.6% jump the previous month, the Commerce Department said Thursday.

The decrease brought the total amount of durable goods to $178.4 billion, Commerce said.

Durable goods are products designed to last three years or more, like machinery, computer equipment, vehicles and appliances. Changes in orders are an indication of how much stores are selling. Consumer spending accounts for two-thirds of the American economy and drives a good deal of the demand for trucking services.

The revised July increase was the largest since October 2000, Commerce said.

Orders for non-defense capital goods, a stand-in for business investment, rose 0.6% in August – their second straight increase. Several economists have said that the economy will not be able to reverse its current malaise until business investment picks up.

In a speech earlier this month, San Francisco Federal Reserve Bank Robert Parry said that "continuation of growth in consumer spending" and "strengthening in business spending on equipment and software" are needed to continue the current expansion, Bloomberg reported.

Bloomberg said that forecasters were expecting a 3% decline in orders.

In a separate, lesser indicator, the number of U.S. workers who applied for unemployment benefits for the first time fell by 24,000 to 406,000 last week, the Department of Labor reported. The four-week moving average, a less volatile statistic, fell to 419,000 from 420,000 last week.

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