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Economy in Brief

U.S. Durable Goods Orders Rebound With Aircraft Bookings
by Tom Moeller  March 26, 2014

New orders for durable goods can be quite volatile depending on what's happening in the transportation sector, which accounts for roughly one-third of the total. Total durable goods orders recovered 2.2% (0.2% y/y) last month following a 1.3% January decline, revised from a 1.0% drop. The improvement lagged expectations for a 0.8% rise in the Action Economics Forecast Survey.

New orders for transportation equipment led last month's recovery with a 6.9% jump (-2.5% y/y), that reversed January's shortfall. It reflected a 13.6% gain (-18.3% y/y) in nondefense aircraft & parts orders, after a 22.1% drop. Motor vehicle & parts bookings improved 3.6% (3.6% y/y) which followed a 1.9% decline.

Outside of the transportation sector, new orders continued to show a mixed performance with a total 0.2% uptick (1.5% y/y) after a 0.9% rise. To the upside last month, primary metals orders gained 1.8% (-0.6% y/y) after a 1.7% fall, while fabricated metal orders improved 0.3% (-3.7 y/y) following an 8.3% jump. Orders for computers & electronic products increased 0.4% (1.5% y/y) after a 3.2% gain. Working lower were machinery orders by 1.5% (+3.9% y/y), after a 1.3% drop. Electrical equipment, appliance & component orders were off 0.9% (-1.3% y/y) following a 3.8% decline. Nondefense capital goods orders fell 2.8% (-7.2% y/y), the fourth month of sharp decline in the last five. Orders excluding aircraft were off 1.3% (+2.2% y/y) and reversed January's gain.

Shipments of durable goods increased 0.9% (3.4% y/y) in February following January's 0.6% fall. Shipments excluding the transportation sector gained 0.7% (2.8% y/y) and reversed January's decline. Unfilled orders improved 0.3%  (6.4% y/y) after being unchanged, while order backlogs outside of the transportation sector were stable (5.3% y/y). Inventories of durable goods improved 0.8% (4.1% y/y) after January's 0.3% rise. Inventories outside the transportation sector increased 0.5% (2.0% y/y) after being roughly unchanged in the prior month.

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 Feb Jan Dec Y/Y 2013 2012 2011
New Orders (SA, %) 2.2 -1.3 -5.3 0.2 5.1 4.1 11.0
  Transportation 6.9 -6.2 -12.1 -2.5 7.7 8.9 14.9
Total Excluding Transportation 0.2 0.9 -1.8 1.5 3.9 2.1 9.5
  Nondefense Capital Goods -2.8 -5.3 -6.3 -7.2 8.6 3.7 15.3
    Excluding Aircraft -1.3 0.8 -1.6 2.2 5.2 2.1 11.6
Shipments 0.9 -0.6 -1.7 3.4 3.7 6.4 9.4
Inventories 0.8 0.3 0.9 4.1 3.7 4.5 10.8
Unfilled Orders 0.3 0.0 0.2 6.4 6.8 3.7 10.0
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