Orders for durable goods dropped unexpectedly in August, mainly due to a decline in demand for commercial aircraft, the U.S. government reported Friday. The second drop in durable-goods orders in three months is evidence that any recovery in the manufacturing sector will be gradual and uneven. The Commerce Department said orders for durable goods (expensive manufactured items expected to last at least three years) fell 2.4 percent last month after increasing 4.8 percent in July. Economists had expected a 0.5 percent increase in August. Orders for commercial airplanes and parts, a volatile category because of the high cost of aircraft, plunged 42.2 percent in August after nearly doubling the previous month. Overall transportation orders fell 9.3 percent. Excluding aircraft and other transportation goods, orders were flat in August, also below analysts' expectations. The drop was despite orders for autos and auto parts rising 0.4 percent, mostly due to a government incentive program. Several other categories recorded weak results. Orders for computers and electronic products fell 0.7 percent after rising for two consecutive months. Electrical equipment and appliance orders fell 0.5 percent after jumping 4.2 percent in July. Non-defense capital goods excluding aircraft (a key measure of business investment in machinery) fell 0.4 percent, its second consecutive decline. The category fell 1.3 percent in July.
