Orders of big-ticket manufactured items ticked down in February on a slump in defense aircraft and parts, according to U.S. government data released Friday.
Durable goods orders dipped 1% last month to $268.4 billion, said the Commerce Department, less than January's fall but defying analyst expectations of a monthly increase instead.
"Excluding transportation, new orders were virtually unchanged," said the department in a statement, adding that orders of transportation equipment have been down for three of the last four months.
Orders of defense aircraft and parts fell 11.1%, while those of computers and related products edged down 2.7%.
Meanwhile, orders of non-defense aircraft and parts dropped 6.6%.
Civilian aircraft figures often dominate swings in orders and "have trended higher over the past couple of years as air travel has recovered post-Covid," Ian Shepherdson, chief economist of Pantheon Macroeconomics, wrote in a recent report.
"That rebound now looks to have run its course, however," Shepherdson said, adding that airline passenger volumes returned to 2019 levels at the end of last year and have leveled off over the past couple months.
He expects a similar trend for vehicles and parts.
Looking ahead, turmoil in the banking sector following the swift collapse of Silicon Valley Bank and Signature Bank in recent weeks would likely lead to tighter credit conditions.
"That will deal an additional blow to capital spending, making it much more likely that the economy slips into recession later this year," Shepherdson said.
Copyright 2023, Agence France-Presse
