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Economy in Brief

U.S. Durable Goods Orders Show Broad-Based Strength
by Tom Moeller  December 24, 2013

Strength in the factory sector is gaining momentum. Orders for durable goods jumped 3.5% (10.9% y/y) last month following a 0.7% October slip, revised from the initial report of a 2.0% decline. A 21.8% surge (63.9% y/y) in orders for nondefense aircraft & parts powered the growth in total orders last month. Defense aircraft bookings also rose 10.1%, though they were down 20.5% y/y. Strength in the transportation sector also reflected a 3.3% rise (15.2% y/y) in motor vehicles & parts orders.

Outside of the transportation sector new orders gained 1.2% (6.1% y/y) following two months of more modest increase. Orders for machinery gained 3.8% (10.8% y/y) while orders for computers & electronic products rose 1.7% (5.8% y/y). These increases were offset by a 1.2% decline (-1.9% y/y) in orders for electrical equipment, appliances & components. Strength in business investment was part of last month's orders gain. Nondefense capital goods orders jumped 9.4% (21.5% y/y), lifted by a 4.5% gain (7.4% y/y) in orders excluding aircraft. This latest rise made up for declines in three of the prior four months.

Shipments of durable goods jumped 1.8% (5.8% y/y) following three months of more moderate increase. Shipments excluding the transportation sector rose 1.6% (3.7% y/y). The relative strength in new orders versus shipments generated a 1.0% increase (7.8% y/y) in unfilled orders. Order backlogs outside of the transportation sector rose 0.5% (6.5% y/y). Inventories of durable goods gained 0.3% (2.8% y/y) and less transportation they also rose 0.3% (0.5% y/y).   

The durable goods figures are available in Haver's USECON database. The Action Economics consensus forecast figure is in the AS1REPNA database.

Durable Goods NAICS Classification Nov Oct Sep Y/Y 2012 2011 2010
New Orders 3.5 -0.7 4.2 10.9 4.1 11.0 23.2
  Transportation 8.4 -3.5 13.1 21.9 8.9 14.9 49.5
Total Excluding Transportation 1.2 0.7 0.3 6.1 2.1 9.5 15.2
  Nondefense Capital Goods 9.4 -0.9 7.0 21.5 3.7 15.3 27.5
    Excluding Aircraft 4.5 -0.7 -1.2 7.4 2.1 11.6 12.9
Shipments 1.8 0.6 0.5 5.8 6.4 9.4 11.0
Inventories 0.3 0.3 0.8 2.8 4.5 10.8 9.4
Unfilled Orders 1.0 0.6 0.9 7.8 3.7 10.0 5.2
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