26 May 2004, 16:32  US durable goods orders post big drop in April

Orders for long-lasting durable goods fell more sharply than expected in April as U.S. factories paused following a stellar March, whose numbers were revised even higher, government data showed on Wednesday. The Commerce Department said orders for big-ticket items meant to last at least three years fell 2.9 percent, the largest decrease since a 6.0 percent fall in September 2002. But March's gain was revised up again to 5.7 percent from 5.0 percent. Wall Street, wary of the volatile nature of this data series, had forecast a 0.2 percent decline as industry took a breather in an otherwise powerful upturn. This has brightened the outlook for the country's battered manufacturers after they suffered in the 2001 recession and lagged in the economy's recovery. The drop in orders was fairly broad-based, with non-defense capital goods excluding aircraft -- a proxy for business spending -- down 3.5 percent, while orders outside the defense sector were 2.4 percent lower. Orders for machinery fell 4.9 percent while computer and electronics registered a 4.1 percent decline. Defense-related capital goods orders posted a 10.9 percent drop and demand for military aircraft was down 5.8 percent.///www.reuters.com

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