U.S. factory orders posted their biggest decline in a year as demand for a wide array of goods fell in April, the government said on Thursday in a weaker-than-expected report.
Factory orders fell 1.7 percent in April after a 5 percent gain a month earlier, the Commerce Department said. It was the biggest monthly decline since April 2003.
Economists on Wall Street had looked for a fall of just 1.2 percent.
The decrease in orders reflected a larger drop in demand for long-lasting, big-ticket items than reported a week ago. The department said orders for durable goods — items like cars and refrigerators that are expected to last three years or more — slid 3.2 percent, compared to an initially reported decline of 2.9 percent.
It was the biggest slide in durable goods orders since September 2002.
Orders for non-durable items were unchanged in April.
The softening of demand allowed factories to restock depleted inventories. Manufacturers cut back on shipments by 0.5 percent, which helped them boost inventories by 0.4 percent. The inventory-to-shipments ratio — a measure of how lean stocks are — rose to 1.24 months' worth from a record low 1.22 in March.
The factory orders report, noted for its volatility, showed demand weakened for most broad categories of goods. Electrical equipment and furniture were the only major category to register increases.