Factory Orders Drop in August

Washington, DC, October 4, 2007—Factory orders dropped 3.3% in August, for their largest decline since January, according to the Commerce Department.

Analysts anticipated orders to slip by 2.6%.

Prime reasons for the drop were a 39.9% decline on the non-defense aircraft category and an 8.5% drop in automotive orders, the sharpest decline in that category since December 2002. Orders for all types of transportation equipment slid 11.1%.

When transportation orders were stripped out, factory orders were off 1.7 % for the second decline in three months. Excluding defense products, orders slipped 3.8 percent.

Orders for non-defense capital goods excluding aircraft, viewed as a reliable indicator of business investment, fell 0.5%, a slimmer drop than originally reported.