US factory orders down 4 per cent in March but business investment category shows small gain

WASHINGTON – Orders to U.S. factories fell in March by the largest amount in seven months but a key category that signals business investment plans managed a small increase.

The Commerce Department says factory orders dropped 4 per cent following 1.9 per cent rise in February, reflecting a big plunge in the volatile category of commercial aircraft. Orders in a category considered a proxy for business investment plans rose 0.9 per cent, a modest gain but an improvement from a preliminary report last week that had shown a decline.

Weaker economies overseas and the impact of across-the-board government spending cuts have made businesses more cautious, dampening demand for manufactured goods. But even with the March decline, total orders stood at $467.3 billion, 43 per cent above the recession low hit in March 2009.