Reports Again Show a Faltering Recovery : * Economy: Factory orders fell in August, while new claims for unemployment are at their highest level since July.

Economic reports released Thursday heightened concern that the fragile recovery may be faltering, adding to pressure for more interest rate cuts to induce consumer spending.

The Commerce Department reported that factory orders fell in August by 1.9% to a seasonally adjusted $243.3 billion, after a revised 6.1% surge in July.

At the same time, the Labor Department reported that unemployment insurance claims for the four weeks that ended Sept. 21 were the highest since July, topping levels that are typical of a recession.

The drop in factory orders was the biggest fall since a 2.9% decline in March.

Shipments of finished goods rose 0.8% after a 0.4% July increase, and inventories of unsold goods fell 0.3% in August in a sixth straight monthly decline, setting the stage for a rebound in production.

But analysts caution that the pick-up remains wobbly without the momentum of consumers confident of their employment prospects.

“You couldn’t conclude from these numbers that manufacturing has fallen back, but if we don’t get stronger consumer demand, that will happen,” said Jean Sundrla, an economist with Evans Economics Inc.

In the Labor Department report, new claims for jobless benefits averaged 423,250 in the four-week period, the highest since the four weeks that ended July 20, when they were at 403,000.

The figures do not bode well for the September employment report, due today, which will provide the first official look at the economy’s performance last month.

A number of economists believe that a weak report will prompt the Federal Reserve to lower interest rates to help boost the economy.

“Inflation is not thought to be a threat at this time,” Sundrla said. “It has been very moderate, which gives the Fed room to move interest rates down without worrying about aggravating inflation.”

The Fed last lowered rates Sept. 13 when it cut the discount rate that it charges banks for loans to 5% from 5.5%. It also pushed the federal funds rate--which banks charge each other for loans--down a quarter of a percentage point to a perceived target of 5.25%.

The White House on Thursday stepped up the pressure on the Fed to cut rates again.

“Whether what they have already done is enough remains to be seen,” said White House economic adviser Michael Boskin in a television interview. “They may have to move again.”

Boskin said the nation’s supply of money, which has been at the low end of the Fed’s targets, has not increased as much as had been anticipated with lower interest rates.

“The Fed has been expecting a rebound of the money supply back more toward the middle of its target ranges, and we’d like to see it get back to the middle,” Boskin said in an interview on NBC’s “Today” show.

Factory Orders

Total new orders in billions of dollars, seasonally adjusted

Aug., ‘91: 243.3

July, ‘91: 248.1

Aug.,: ‘90: 250.6

Source: Commerce Department