Especially when compared with a nearly 2% increase in June, it's fair to say that new orders for U.S. manufactured durable goods plunged in July. Led by an 8.6% decline in orders for airplanes and other transportation equipment, new orders for manufactured durables fell to a seasonally adjusted $204.7 billion last month, a 4.9% decrease, the U.S. Commerce Department reported on August 24. July's percentage drop was more than four times the 1.2% decline economists generally expected.
In contrast, In June new orders for durables, generally big-ticket goods designed to last at least three years, had increased 1.9%.
New orders for fabricated metal products were down 4.4% in July; for machinery, down 6.2%; for computers and related products, down 8.3%; for communications equipment, down 7.1%; for electrical equipment, appliances and components, down 2%; for non-defense aircraft and parts, down 20.2%; and defense aircraft and parts, down 5%.
"Gas prices up 35 cents in August, existing home sales falling and paling durable goods indicate inflation is up and the economy is headed for a slowdown," warns Peter Morici, a professor at the University of Maryland's Smith School of Business in College Park.