Durable Goods Fall More Than Expected, Year-Over-Year Trend Down

The Commerce Department said Tuesday that demand for durable goods — or, products designed to last at least three years — fell last month more than expected. Orders declined a seasonally adjusted 0.5 percent in April from the month prior, while March durable goods orders were revised up to show a gain of 5.1 percent, up from a previously reported 4.4 percent.

Economists surveyed by The Wall Street Journal had expected overall orders to fall 0.1%.

While it is true that durable goods are volatile and subject to large revisions, the broader trend after several weak months in still uncertain. Compared with a year earlier, overall orders fell 1.3 percent in April.

Last month saw a drop in orders for aircraft and, excluding the volatile transportation sector, orders ticked up by just 0.5 percent.

Most economists now believe the government’s expectations were widely off in the first quarter, and that the economy contract rather than an abysmal 0.2 percent gain.