Durable goods orders in surprise fall

[NEW YORK] Orders for durable goods unexpectedly slumped in December by the most in five months, reflecting a broad-based retreat that raises the risk business investment will cool in early 2014.

Bookings for goods meant to last at least three years dropped 4.3 per cent after a 2.6 per cent gain in November that was smaller than previously reported, a Commerce Department report showed yesterday in Washington. The median estimate of 82 economists surveyed by Bloomberg called for a 1.8 per cent advance. Orders for non-military capital goods excluding aircraft also declined.

Yesterday's report is the first to indicate that the slowdown in growth last month went beyond the unusually cold temperatures. Stagnant wages and inconsistent job gains probably mean consumer spending, which accounts for almost 70 per cent of the economy, will not be able to sustain recent gains.