US durable goods orders dive in January
New orders for US durable goods made a broad-based dive in January after three straight months of gains, led by a slump in commercial aircraft orders, government data showed Tuesday.
But analysts blamed the fall on the end of a special capital investment tax break rather than a slowdown in the economy.
New durable goods orders fell 4.0 percent from January to $206.1 billion, the Commerce Department reported.
It was the steepest decline since January 2009, when orders plunged 13.2 percent, and was much worse than the average analyst forecast of a 1.4 percent drop.
Excluding the transportation sector, new orders fell 3.2 percent.
New orders for transportation equipment were the biggest decliner, the department said, down 6.1 percent. Nondefense aircraft orders plunged 19.0 percent.
But the overall decline was broad-based, including machinery, computers and defense aircraft.
Ian Shepherdson at High Frequency Economics said the weak January number appeared to be a one-time adjustment to the December 31 expiration of bonus tax deductions for capital spending.
"Unquestionably, it looks bad, but the context is important; we see no evidence of underlying slowing in the industrial economy so we look for a rebound in February and the re-emergence of the upward trend over the next couple of months," he said.
The Commerce Department upwardly revised the December increase to 3.2 percent.
Recent reports have suggested that manufacturing, a key driver of the economic recovery, started the year on a positive note.
The closely watched Institute for Supply Management's manufacturing index rose to 54.1 percent in January from 53.1 in December, led by a jump in new orders.