WASHINGTON (AFP) - New orders for manufactured goods plunged in March, mainly due to a steep decline in transportation orders, government data released on Friday showed.

The Commerce Department reported a 4 per cent drop in factory orders from February, when orders had climbed 1.9 per cent. The March reading was well below the 2.5 per cent decline expected by most analysts.

Excluding transportation, factory orders fell 2 per cent in March. Commercial aircraft orders, which tend to be volatile month-on-month, dived 48.3 per cent.

Defence communications equipment orders posted the steepest decline, down 84.3 per cent, followed by machinery orders for mining and oil and gas fields, down 31.3 per cent.

On a 12-month basis, March orders were 0.2 per cent lower.