Economists have been generally expecting the US economy to lose momentum this year and particularly in the first quarter, as the stimulus from the $1.5 trillion tax cut fades away.
There are a series of other reasons for expecting slower growth in 2019, including the slowing of growth in China and the Euro Area, the uncertainty over the timing and the impact of Britain's exit from the European Union, and as well, the uncertainty caused by the on going trade war between the United States and China.
Economic growth in the first quarter could come in as slow as an annual 1.2% annual pace compared with 2.2% in the fourth quarter.
New orders for key U.S.-made capital goods unexpectedly fell in February after three straight months of growth due to a sharp decline in civilian aircraft orders. Shipments rose 0.2% in February after a large 0.4% decline in January.
Durable goods orders were down 1.6% in February, with nondefense aircraft and parts (Boeing) accounting for the bulk of the decline. Excluding transportation, durable orders inched up 0.1%.
Non-defense capital goods excluding aircraft are a closely watched proxy for business investment spending and they slipped 0.1% in February. The weakness in February was mainly due to the declines in demand for machinery, computers and electronic products.
New orders for key U.S.-made capital goods unexpectedly fell in February and shipments were unchanged in February, core orders (nondefense capital goods orders ex air) were down 0.1% compared with a January gain of 0.9%.
Core shipments (nondefense capital goods shipments incl. air) increased 0.6% compared with January’s decline of 1.5%.
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