New orders for manufactured goods fell 1.5%, according to a Department of Commerce December report (link opens in PDF) released today. After soaring to an initially recorded record high in November, analysts had expected a slightly larger 1.8% decline. Much of December's weakness comes from a plunge in volatile aircraft orders.
Despite December's better-than-expected report, durable-goods orders showed some reason for worry with a 4.2% drop. Transportation equipment (namely, aircraft) was a major reason for the dip, with orders down 9.7%. Investors use durable goods orders as a proxy for manufacturers' longer-term confidence in the economy. For December, demand for commercial aircraft fell 17.5% after having risen 21.1% in November. Demand for construction machinery was down 2.9% and demand for computers and other electronic products fell 6.3%. New orders for manufactured nondurable goods -- such as chemicals, paper and food -- edged up 1.1%.
Unfilled orders increased 0.4% to a record high since data were first collected in 1992, while shipments fell 1.7%. Inventories expanded 0.8%, also hitting an all-time high.
The inventories-to-shipments ratio, a statistic used to measure the sustainable flow of goods, edged up 0.01 points to 1.29, since inventories expanded as shipments declined.
-- Material from The Associated Press was used in this report.
Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.