US factory orders drop more than expected

Factory orders dropped by more than three times as much as analysts expected in September as the US manufacturing sector continues to suffer from the economic downturn.

The Commerce Department said Tuesday that factory orders fell by 2.5 per cent from August, far more than the 0.8 per cent drop expected by Wall Street economists surveyed by Thomson Reuters. That8217;s on top of a revised 4.3 per cent decline in August, which was the steepest in almost two years.

Excluding autos and aircraft, orders fell 3.7 per cent, the steepest drop since 1992 when the department first began tracking sector-specific changes. Orders for non-defense capital goods excluding aircraft, considered a good indication of business investment plans, fell by 1.5 per cent. That follows a 2.3 per cent drop in August and indicates companies are cutting back on investments, likely due to the economic downturn.