Economic Report


First decline after nine straight gains – nondurable orders lead the way down

Workers putting finishing touches on a Boeing 737 MAX 9 airplane on the tarmac at the Boeing Renton Factory in Renton, Washington. (Photo by Jason Redmond/AFP via Getty Images)

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Orders for manufactured goods fell a sharp 1% in July, the Commerce Department said Friday. 

Economists surveyed by the Wall Street Journal were expecting a 0.2% increase. 

This is the first decline after nine straight gains. Orders rose 1.8% in June.

The factory sector, which led the economy’s recovery from the pandemic, has started to struggle. 

According to the updated data, durable-goods orders fell 0.1% in July, revised down slightly from the initial estimate of a flat reading. 

Orders for nondurable goods were down 1.9% in the month. That’s the biggest drop since the economy was shut down in April 2020 in an effort to mitigate the spread of COVID-19. Pre-pandemic, it is the weakest reading since November 2018.

Most of the drop was due to a decline in orders in the petroleum sector. Excluding that category, nondurable orders were down just 0.3%.

Orders for nondefense capital goods, excluding aircraft, rose a revised 0.3% in July, down slightly from the prior reading of a 0.4% gain.

Stocks DJIA, +0.61% SPX, +0.66% were higher Friday in the wake of the moderation in job growth in August. A cooler job market could reduce pressure on the Fed to boost interest rates.