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April 27, 2005

Gurk!

An unhappy durable goods number:

FT.com / International economy - US durable goods orders drop 2.8% By Christopher Swann in Washington: Orders for durable goods fell unexpectedly last month, adding to the mounting gloom in financial markets over the strength of the US economy. The 2.8 per cent fall - the largest monthly decline in more than 2 years - was relatively broadly based with ebbing orders for aircraft, cars and computers. Even excluding the volatile transport sector, bookings fell 1 per cent after a 0.2 per cent decline in February. The closely watched non-defence capital goods excluding aricraft component - seen as the best proxy for business equipment investment - slid 4.7 per cent after a 2.5 per cent decline in Febraury. ING Financial Markets said this may cause some analysts to nudge down their expectations for economic growth in the first quarter to 3 per cent from around 3.5 per cent. "Overall another disappointing figure that is likely to increase talk of a pause at some point by the Federal Reserve as it moves rates to neutral," ING said, in its research this morning.

Posted by DeLong at April 27, 2005 08:02 PM