US durable goods orders plunge 4.5% in May, less than expected

New orders for US-manufactured durable goods fell 4.5% in May, reversing two months of increases, according to data released by the Census Bureau on Thursday.

Orders decreased by $15.6 billion from the previous month to $332.1 billion, following an upwardly revised 8.5% increase in April.

The markets had expected the orders to fall 5% in May.

Transportation equipment was the main drag, with orders falling $18.5 billion, or 14%, to $113.5 billion. Capital goods orders also declined sharply, down 13.6% to $118.3 billion.

Excluding transportation, new orders rose 1.3% in May after a 1.4% increase in April, while orders excluding defense decreased 4.6% after rising 8.4% in the previous month.

Shipments of manufactured durable goods increased 1% to $327.9 billion, while transportation equipment shipments rose 1.4% to $109.5 billion.

Nondefense aircraft and parts orders dropped 51.8% in May after surging 167.4% in April, while motor vehicles and parts orders rose 1.1%.