Durable Goods Orders Fall 0.5%, but Rise When Excluding Transportation

otal orders for durable goods declined 0.5% in August to $195.4 billion, but rose 2.3% when excluding transportation equipment, the Commerce Department reported Friday.

Durable orders, which are goods made to last at least three years, are often looked to as an indicator of future factory activity. Factory activity drives demand for transportation services, particularly trucking, which hauls finished products and components to and from production plants.

Commerce said bookings for non-defense capital goods excluding aircraft, a proxy for future business investment, fell 0.5% last month, after a gain of 0.6% in July.

Orders for transportation equipment fell 6.8% in August after rising 6.5% in July. Bookings for commercial aircraft fell 42.8%, after more than doubling the month before.

ompared with a year earlier, orders for durable goods were up 12.4%. Excluding transportation equipment, orders were up 14.2% from August 2003.

Commerce also said orders for motor vehicles rose 5.7% percent, the most since February.

Shipments of non-defense capital goods excluding aircraft, which the government uses to construct quarterly gross domestic product figures, rose 0.5%.

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