Orders for US-made durable goods, or big-ticket items, tumbled 2.8% in March, the steepest decline since September 2002, according to the latest figures from the Commerce Department.
The news came as a surprise to Wall Street analysts, who had predicted a rise of 0.3%, on average.
The Commerce Department also revised downward its February report on durable goods to show a 0.2% decline instead of a 0.3% increase.
Big-ticket durable goods orders - those expected to last three years or more - are seen as crucial to manufacturing, which is a key to maintaining economic momentum. The report comes a day ahead of a report on first-quarter US economic growth, which is expected to show a slowdown.
Transportation represented the biggest drop in orders, down 7.8%. Orders for civilian airplanes fell 22.7%, while orders for military aircraft dropped 35%.
Orders for motor vehicles fell 2.4% - the third straight month that car and truck orders fell. All orders, excluding transportation, fell 1%, the second straight decline.
Core orders for capital equipment used by businesses fell 4.7% after declining 2.5% in February. It was the largest drop since November 2003.
The categories of computers and electronic equipment and primary metals were the only one that rose in March.
