Friday 30 September 2016

New orders for US factory goods fell for a second straight month in September as the manufacturing sector continues to struggle under the weight of a strong dollar and deep spending cuts by energy companies.

Lucia Mutikani

Published 04/11/2015 | 02:30

Photo: PA
Photo: PA

New orders for US factory goods fell for a second straight month in September as the manufacturing sector continues to struggle under the weight of a strong dollar and deep spending cuts by energy companies.

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Motor vehicle production, however, remains a bright spot as orders surged in September. That trend is likely to persist, with early reports yesterday showing car sales were on track to be the strongest in 14 years.

"The report provides little new signal on the state of US manufacturing. Demand for many categories of manufactured goods continues to struggle from the effect of a stronger dollar, weak foreign demand and lower energy prices," said Jesse Hurwitz, an economist at Barclays in New York.

The Commerce Department said new orders for manufactured goods declined 1pc after a downwardly revised 2.1pc drop in August. Factory orders were previously reported to have declined 1.7pc in August.

Orders for cars and parts rose 1.5pc in September after falling 2pc in August.

Top US carmakers reported October sales that far exceeded analyst expectations. General Motors predicted that October industry sales would come in around 18.2m vehicles on an annualised basis, their highest level since 2001.

Factory activity, which accounts for about 12pc of the economy, is also being constrained by efforts by businesses to reduce an inventory overhang and tepid global demand.

But the worst could be over for the sector after a report on Monday showed new orders rose in October for the first time since July.

The dollar has gained 16.8pc against the currencies of the United States' main trading partners since June 2014,

(Reuters)

Irish Independent

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