Orders for durable goods dropped unexpectedly in September, falling for a second month, on waning demand for machinery and computers that signals companies are reluctant to invest in updating equipment.
Bookings for goods meant to last at least three years decreased 1.3 percent after declining 18.3 percent in August, a Commerce Department report showed today in Washington. The median forecast of 83 economists surveyed by Bloomberg called for a 0.5 percent gain.
Companies are looking for more signs of sustained consumer demand before making high-dollar investments, even as households benefit from strong job gains and pared-down debt. As markets in Europe and emerging nations slow, fewer exports will probably also damp orders in coming months, indicating American manufacturing will cool.
“Clearly businesses seem a little worried, not so much about U.S. growth but global growth, so they’re being very cautious,” said Nariman Behravesh, chief economist at IHS Inc. in Lexington, Massachusetts, who forecast a 0.8 percent drop in orders. “The worry is they retreat back into their shells.”
Stock-index futures trimmed prior gains after the report. The contract on the Standard & Poor’s 500 Index maturing in December rose 0.3 percent to 1,963.2 at 8:44 a.m. in New York. It had been up as much as 0.6 percent earlier today.
Bloomberg survey estimates for durable goods ranged from a decline of 1.7 percent to an increase of 5 percent after a previously reported 18.4 percent drop in August.
Excluding transportation equipment, which is often volatile month to month, bookings declined 0.2 percent, today’s report showed.
Orders for non-defense capital goods excluding aircraft, a proxy for future business investment in items like computers, engines and communications equipment, dropped 1.7 percent, the most since January, after a 0.3 percent gain the previous month.