New orders received by US factories tumbled for a second straight month in September, underscoring the grim economy awaiting the new US president.

Overall factory orders dropped 2.5 per cent to a seasonally adjusted $432 billion, according to a Commerce Department report quoted by Reuters. Economists expected a more modest 0.8 per cent fall and the sharp drop in orders follows a 4.3 per cent plunge in August orders, which was originally reported as a 4 per cent decline.
Excluding transportation, orders plummeted a record 3.7 per cent in September after a 3.6 per cent August drop.
“It’s a deeply negative report. Overall, this is setting the economy up for a very bleak fourth quarter,” said Kurt Karl, the chief US economist at Swiss Re in New York.
The report adds to signs of a rapid downturn sweeping manufacturing in the United States, which earlier this year was somewhat shielded from the housing crash and credit freeze thanks to overseas demand.
Now, factories may be suffering as the US dollar strengthens, making US exports less competitive while slowing European economies slow cut demand for US goods.
The Institute for Supply Management said its index of national factory activity fell to 38.9 in October from 43.5 in September. The level of 50 separates contraction from expansion, and a reading below 40 is exceptionally weak.
The blow the global financial crisis has dealt to US manufacturing may prove sustained as the overall economy slips into recession, said the institute.
After a steep fall of manufacturers' new orders in October, these may take some time to rebound, said Norbert Ore, chairman of the its manufacturing business survey committee on a conference call with reporters.