KONTAN.CO.ID - WASHINGTON. New orders for U.S.-made goods slipped in August and business spending on equipment was much weaker than initially thought, the latest indications that manufacturing was in a slump.

Factory goods orders dipped 0.1% after surging by an unrevised 1.4% in July, the Commerce Department said on Thursday. Economists polled by Reuters had forecast factory orders would fall 0.2% in August.

Factory orders edged down 0.1% compared to August 2018.

Shipments of manufactured goods fell 0.1% in August after decreasing 0.3% in the prior month. Pointing to underlying weakness in the sector, which accounts for about 11% of the economy, unfilled orders at factories nudged up 0.1% after the same gain in July. Inventories were unchanged in August after ticking up 0.1% in July.

A survey from the Institute for Supply Management (ISM) on Tuesday showed a measure of national factory activity tumbled to more than a 10-year low in September. The ISM said comments from manufacturers "reflect a continuing decrease in business confidence," and also noted that "global trade remains the most significant issue."

Ironically, manufacturing has borne the brunt of the 15-month U.S.-China trade war, which has thumped business confidence. The Trump administration has argued that trade tariffs are necessary to protect industries from what it says is unfair foreign competition.

Troubles in manufacturing, which are also the result of an inventory overhang and the grounding of Boeing's 737 MAX plane after two fatal crashes in Indonesia and Ethiopia, have been underscored by factories cutting overtime for workers.

Transportation equipment orders fell 0.4% in August after increasing 7.3% in July. Orders for civilian aircraft and parts dropped 17.1% after rising 52.2% in the prior month.

There were also decreases in orders for computers and electronic products and electrical equipment, appliances and components. Machinery orders, however, rose 0.4% in August after declining 1.0% in July.

The Commerce Department also said August orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, fell 0.4% instead of the 0.2% drop reported last month.

Shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, increased 0.3% in August instead of rising 0.4% as previously reported. Business investment declined at its steepest pace in 3-1/2 years in the second quarter.

Editor: Herlina Kartika Dewi