U.S. factory orders are shrinking in 2012.
June 5, 2012– For the second straight month, fewer orders were made by companies to factories in the U.S. The figure is key in tracking the plans of business investment said the Commerce Department Monday. It was just more evidence that pointed to the economy weakening.
In April, factory orders dropped 0.6% from March. Demand for core capital goods like computers and heavy machinery fell 2.1% during April, following a decline of 2.3% in March.
The two straight months of declines suggested that companies might still be worried about the job market in the U.S. being weak, which could slow down consumer spending. Businesses might also fear the debt crisis in Europe is worsening and growth in China is slowing.
Even though there have been two consecutive months of declines, the amount of factory orders remain well above what they were during the recession, the total of orders for April was $465.98 billion, an increase of 38.7% from the March 2009 recession low. Nevertheless, orders remain 3.1% below their peak that was attained in December of 2007, the same month the recession started.
Demand for items like aircraft and autos that have a life of a minimum of three years, was flat during April. That was a downward revision from the durable goods estimate that said orders would increase by 0.2% during April.