US Factory Goods Dropped Less Than Expected in May

New orders for U.S.-made goods fell more than expected in May, but orders for capital equipment were a bit stronger than previously reported, suggesting the manufacturing sector remained on a moderate growth path.

Factory goods orders dropped 0.8 percent, the Commerce

Department said on Wednesday after a revised 0.3 percent decline in April. It was the second straight monthly decrease in orders.

Economists had forecast factory orders falling 0.5 percent in May after a previously reported 0.2 percent drop in April.

Factory orders were up 4.8 percent from a year ago.

Manufacturing, which accounts for about 12 percent of the

U.S. economy, is losing momentum after gaining steam since mid-2016 amid a recovery in the energy sector that led to demand for oil and gas drilling equipment.

Activity is slowing against the backdrop of a moderation in oil prices and declining motor vehicle sales. Motor vehicle manufacturers reported on Monday that auto sales fell in June for a fourth straight month, leading to a further increase in inventories, which could weigh on vehicle production.

via Reuters

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