New orders for U.S.-made capital goods surprised many by falling last month and shipments also declined, suggesting a loss of momentum in the manufacturing sector halfway through the second quarter.
Figures released Monday by the U.S. Commerce Department that non-defense capital goods orders excluding aircraft, a closely-watched proxy for business spending plans, dropped 0.2%.
It's a surprise because these so-called core capital goods orders were revised to show an increase of 0.2% for April. They were previously reported to have risen 0.1%.
The department also said shipments of core capital goods fell 0.2% last month after rising 0.1% in April. Core capital goods shipments are used to calculate equipment spending in the government's gross domestic product measurement.
Economists had forecast core capital goods orders rising 0.3% in May. Overall orders for durable goods, items ranging from toasters to aircraft meant to last three years or longer, fell 1.1% after declining 0.8% in April.
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