The United States Census Bureau released data for durable goods orders which recorded a decline more than forecast in April. Durable goods are defined as goods meant to last for at least three years. Data indicated the biggest drop since October, a fall of 3.6 percent versus a March increase of 4.4 percent. Expectations were for a drop of 2.5 percent.
The United States Department of Commerce noted that a demand for business equipment declined by the most this year.
Meanwhile the data also reflects a drop in demand for aircraft and disruptions in supplies of auto parts stemming from the earthquake in Japan.
A breakdown of statistics show that orders for Boeing aircraft, one of the largest aircraft manufacturers in the world, slumped last month. Additionally, vehicle manufacturers slowed production due to a components shortage that may be short-lived as Japanese manufacturers
Core Durable Goods Orders exclude the transportation equipment category due to their volatility since they can distort the underlying trend. Hence Core orders are more accurate. This data showed a decrease of 1.5 percent in April after a 2.5 percent gain. Expectations were for a 0.5 percent rise.
The disappointing data caused the Dollar to drop by 25 pips against the Euro within five minutes of the news (8:30am CET), when EURUSD jumped from 1.4067 to 1.4092.