US factory orders drop unexpectedly

WASHINGTON (AFP) – Lower demand for machinery and defense equipment prompted a fall in US factory orders in February, the Commerce Department said Thursday, dashing hopes for a rebound after start-of-year blizzards.

New orders for big-ticket items — such as planes, computers and cars — fell 0.9 percent during the month, led by a 4.2 percent drop in machinery orders.

That shocked economists, who had expected orders to rise.

“We expected a hefty rebound after the blizzards depressed core orders in January,” said Ian Shepherdson of High Frequency Economics.

But experts took some heart from the fact that without wildly erratic defense equipment, new orders would have actually risen 0.4 percent.

“Bottom line is that this does not look good,” said Shepherdson, adding that lingering weather effects or statistical anomalies may yet be to blame.