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US business spending gauge tumbles in February
[WASHINGTON] US business investment spending plans fell for a sixth straight month in February, likely weighed down by a strong dollar and weak global demand, which could see economists further lower their first-quarter growth estimates.
The Commerce Department said on Wednesday non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, dropped 1.4 per cent last month after a revised 0.1 per cent dip in January.
The so-called core capital goods orders last rose in August.
Business spending on capital goods has been hurt by a strong dollar which has cut into overseas profits of multinational companies. Lower crude prices also have acted as a drag, forcing oil firms to either delay or cut back on investment projects.
That has helped restrain economic growth early in the first quarter.
Economists polled by Reuters had forecast core capital goods orders gaining 0.3 per cent last month after a previously reported 0.5 per cent rise in January.
Shipments of core capital goods, which are used to calculate equipment spending in the government's gross domestic product measurement, rose 0.2 per cent last month after slipping by a revised 0.4 per cent in January.
Shipments in January were previously reported to have gained 0.1 per cent. That downward revision could see economists trim their first-quarter GDP growth estimates, which currently range between a 1.2 per cent and 2 per cent annual pace.
With core capital goods orders falling, overall orders for durable goods - items ranging from toasters to aircraft that are meant to last three years or more - fell 1.4 per cent last month.
Durable goods orders were also hampered by a 3.5 per cent plunge in orders for transportation equipment. Durable goods orders increased 2 per cent in January.