Orders to US factories for big-ticket manufactured goods dropped a record 12.4 percent last month, prompted by the largest monthly reduction in demand for airplanes and other transportation equipment, the Commerce Department reported. With sales of airplanes and aircraft parts in decline, analysts had expected only a 7.7 percent drop after durable-goods orders jumped 9.5 percent in June. The data comes a day after the Federal Reserve, citing signs of a moderating economy, opted not to raise interest rates. The Fed had raised rates six times over the past 14 months.
Striking employees at Volkswagen's Mexican affiliate also decided they'd go back to work, but only after the federal government ordered them to do so or face being fired. The move came after an arbitration board ruled Tuesday that the five-day strike by 12,600 workers was illegal, partly because the union didn't give proper notice. The strike at the plant in Puebla - the only place in the world producing the New Beetle - cost Volkswagen an estimated $5 million per day.
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