WASHINGTON • New orders for United States factory goods rose for a third straight month in September, but a further decline in order books suggested the manufacturing sector will struggle to emerge from a prolonged slump.
The Commerce Department said yesterday new orders for manufactured goods increased 0.3 per cent, after an upwardly revised 0.4 per cent gain in August.
Economists polled by Reuters had forecast factory orders rising 0.2 per cent in September, after a previously reported 0.2 per cent increase in August. Unfilled orders at factories fell for a fourth straight month in September.
Manufacturing, which accounts for about 12 per cent of the economy, has been hurt by a strong dollar and weak global demand. Production has also been undermined by the collapse in oil drilling activity in the aftermath of the plunge in oil prices.
Orders for transportation equipment fell 1.1 per cent, largely reflecting a drop in defence aircraft orders. Motor vehicle production jumped 2.6 per cent, the largest increase since July last year. Orders for machinery increased 1.1 percent, the biggest rise since January.
The Commerce Department said orders for non-defence capital goods excluding aircraft - seen as a measure of business confidence and spending plans - fell 1.3 per cent instead of the 1.2 per cent decline reported last month.
Separately, US service industries expanded less than projected last month, consistent with moderate growth in the biggest part of the economy. The Institute for Supply Management's non-manufacturing index fell to 54.8 from 57.1 in the prior month.
Slowdowns in orders and employment contributed to the weaker results for service producers, who account for about 90 per cent of the economy.