Orders to U.S. factories fell in March by the largest amount in seven months, but a measure of planned business spending rose slightly, suggesting businesses are continuing to spend despite a slowdown in manufacturing activity, the government reported Friday. The Commerce Department said orders for manufactured goods fell 4 percent in March following a 1.9 percent rise the previous month. Economists had expected a smaller March decline. The drop in factory orders reflected a plunge in the volatile category of commercial aircraft. Civilian aircraft orders fell 48.3 percent. U.S. aerospace giant Boeing previously reported orders in March for 39 aircraft, down from 179 the previous month. Excluding transportation, factory orders fell 2 percent, pointing to underlying weakness in the manufacturing sector. Orders for durable goods—expensive manufactured items expected to last at least three years—fell 5.8 percent, the biggest decline in seven months. Orders for non-defense capital goods excluding aircraft—a closely watched gauge of business spending plans—rose 0.9 percent, a modest gain but an improvement from a preliminary report last week that had shown a decline. Weaker economies overseas and the impact of sharp U.S. government spending cuts have made businesses more cautious, reducing demand for manufactured goods. But even with the March decline, total orders stood at $467.3 billion, 43 percent above the recession low seen in March 2009.
