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Economy in Brief

U.S. Factory Orders Decline As Inventories Gain
by Tom Moeller  March 06, 2013

Orders to all manufacturers fell 2.0% (+0.3% y/y) following a 1.3% December rise, revised from 1.8%. The decline roughly matched expectations. A 4.9% shortfall (-0.8% y/y) in January durable goods orders, little-revised from the advance report, led the overall drop in orders. It mostly reflected a two-thirds collapse in defense aircraft orders (-31.6% y/y) as well as a one-third drop (-49.7% y/y) in orders for commercial aircraft & parts. Orders for nondurable goods, which equal shipments, rose 0.6% (1.2% y/y) and reversed the December decline. Shipments of apparel rose 2.4% (-0.5% y/y) while shipments of chemicals gained 0.3% (-2.1% y/y). Shipments from petroleum refineries recovered 0.6% (2.8% y/y) as prices improved. These increases were offset by a 0.6% decline (-1.8% y/y) in shipments of paper products. Shipments from textile mills also fell 0.3% (+1.0% y/y).

Inventories in the factory sector jumped 0.5% in January (2.2% y/y) following three months of having been unchanged. A 1.9% rise (-4.6% y/y) in inventories at petroleum refineries followed three months of decline. Elsewhere, chemical inventories jumped 2.3% (-0.7% y/y) but apparel inventories slipped 0.2% (+7.7% y/y). In the durable goods sector inventories gained 0.2% (4.0% y/y). A 1.5% rise (1.4% y/y) in electrical equipment & appliances was offset by a 0.9% decline (+3.3% y/y) in machinery inventories. Order backlogs fell 0.2% (+1.4% y/y) with the sharp decline in orders and just a moderate fall in shipments.

The factory sector figures are available in Haver's USECON database. The expectation figure is in AS1REPNA

Factory Sector- NAICS Classification Jan Dec Nov Y/Y 2012 2011 2010
New Orders -2.0 1.3 -0.3 0.3 2.7 11.8 18.0
Shipments -0.2 -0.0 0.3 1.9 4.1 11.8 11.2
Inventories 0.5 0.0 -0.0 2.2 2.4 9.4 8.8
Unfilled Orders -0.2 0.7 0.0 1.4 2.3 10.3 9.6
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