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Economy in Brief

U.S. Durable Goods Orders Soar With Aircraft Bookings; Orders Weaken Elsewhere
by Tom Moeller  April 24, 2015

New orders for durable goods jumped 4.0% during March (0.7% y/y) following an unrevised 1.4% February decline. Leading the increase were orders for defense aircraft which roughly doubled m/m (26.5% y/y). Nondefense aircraft orders also were strong, posting a 30.6% gain (-3.2% y/y). Total durable goods orders were expected to rise 0.8% in the Action Economics Forecast Survey. During the last ten years, there has been an 88% correlation between the y/y change in orders and the change in real GDP.

Outside of the transportation sector, new orders slipped 0.2% (-1.9% y/y), the sixth consecutive monthly shortfall which totals 5.5%. Machinery orders declined 1.5% (-11.6% y/y), down 12.8% since a June peak. Orders for electrical equipment & appliances fell 1.1% (-1.7% y/y) and were 7.6% below June's high. Orders for both fabricated & primary metals fell modestly m/m and have been trending lower. Offsetting these declines was a 3.0% increase in orders for computers & electronic products though they were unchanged y/y. Orders for motor vehicles & parts have been notably strong. They jumped 5.4% last month (10.0% y/y) to an all-time high.

Nondefense capital goods orders recovered 3.5% (-3.4% y/y) following a 2.2% decline. Orders excluding the notably volatile aircraft sector, however, slipped 0.5% (-4.0% y/y) and were 6.7% below the August peak.

Shipments of durable goods improved 1.1% (3.7% y/y) following a 0.2% slip. Shipments excluding transportation edged 0.3% higher (0.5% y/y) after a 0.5% drop. Unfilled orders were unchanged (+8.0% y/y) following declines in the three prior months. Backlogs less the transportation sector fell 0.5% (+3.8% y/y), down for the fourth straight month. Inventories of durable goods ticked 0.1% higher (5.1% y/y), the weakest of the last three monthly gains, and excluding transportation they also rose 0.1% (4.0% 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 Mar Feb Jan Mar Y/Y 2014 2013 2012
New Orders (SA, %) 4.0 -1.4 1.9 0.7 6.1 5.2 4.1
  Transportation 13.5 -1.8 8.9 6.5 8.4 7.9 8.9
Total Excluding Transportation -0.2 -1.3 -0.9 -1.9 5.0 4.0 2.1
  Nondefense Capital Goods 3.5 -2.2 8.5 -3.4 6.1 8.7 3.7
    Excluding Aircraft -0.5 -2.2 -0.3 -4.0 4.4 5.0 2.1
Shipments 1.1 -0.2 -1.4 3.7 5.0 3.7 6.4
Inventories 0.1 0.2 0.3 5.1 5.8 3.8 4.5
Unfilled Orders 0.0 -0.5 -0.3 8.0 9.9 7.0 3.6
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