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Economy in Brief
Composite PMIs...the Best of Times; the Worst of Times-Really?
PMI data now rank observations on their range of values since December 2016...
U.S. Housing Starts Rise Again in December
Housing starts increased 5.8% (5.2% y/y) during December to 1.669 million...
Philadelphia Fed Manufacturing Index Jumps in January
The Federal Reserve Bank of Philadelphia Factory Sector Business Conditions Index jumped to January to 26.5...
U.S. Initial Jobless Claims Ease, but Are Still High
Initial claims for unemployment insurance fell to 900,000 in the week ended January 16...
French Surveys Improve Despite Ongoing Virus Issues
The spread of the virus in Franc is still untamed...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Carol Stone, CBE January 5, 2018
Manufacturers' orders gained 1.3% in November (8.6% y/y) following a 0.4% rise in October; this earlier number was revised from a 0.1% decrease initially reported. Durable goods orders were also up 1.3% (8.2% y/y); they had fallen 0.4% in October. The upturn was in the transportation sector, where November new orders gained 4.1% (10.1% y/y), reversing a 4.0% drop in October. That swing took place in the nondefense aircraft sector; those orders had dropped 15.8% in October but came back 14.7% in November (110.2% y/y). Orders outside the transportation sector rose 0.8% (7.6% y/y) following a 1.2% jump. Most of that move came in the nondurable goods segment, up 1.4% (8.1% y/y); see the shipments discussion below for more detail. Among durable goods, orders for electrical equipment were up 0.6% (1.1% y/y) in November after 1.1% the month before. Other main sectors had declines, especially computer & electronic products, 0.5% (14.3% y/y), easing after a 1.6% gain in October Orders for machinery fell 1.0% in November (10.4% y/y), also reversing a sizable October rise, 2.8%.
Total factory sector shipments rose 1.2% (7.8% y/y) in November after an 0.8% increase. Durable goods shipments increased 0.9% (7.5% y/y). Transportation equipment shipments jumped 2.6% (6.9% y/y) as nondefense aircraft rebounded 11.9% (10.8% y/y) after October's 12.2% drop. Auto shipments came back 1.1% (-6.8% y/y) after a 2.6% fall. Light truck shipments extended their 4.8% October gain, going up 1.8% in November (13.5% y/y). Excluding the transportation sector, shipments rose 0.9% (7.9% y/y). Those of computer & electronic products gained 0.5% (6.78% y/y), but machinery shipment fell 0.3% (10.3% y/y).
Nondurable goods shipments happen within the same reporting period as orders, and the series are equal. As noted above, these orders/shipments rose 1.4% in November. The value of petroleum refinery shipments increased 6.3% (36.6% y/y) as oil prices continued to rise. Basic chemical shipments were up 1.6% (4.2% y/y), improving on a 1.1% October advance. Textile products and apparel both gained 1.7% in November; textiles were up 5.9% y/y and apparel 6.7% y/y. Food product shipments fell 0.9% (+3.9% y/y)
Unfilled orders edged higher 0.1% (0.57% y/y) in November, following a similar 0.1% rise the month before. Outside the transportation sector, unfilled orders rose 0.5% (4.6% y/y); unfilled orders for the whole manufacturing sector are identical to those for durable goods, since orders and shipments for nondurable goods are seen as equal. Transportation backlogs decreased 0.1% (-1.0% y/y) after a 0.2% decrease in October. Other durable goods sectors saw backlogs up 0.5% (4.6% y/y) with furniture up 0.8% (2.1% y/y), computers, 0.3% (3.4% y/y) and machinery, 0.2% (4.1% y/y).
Inventories at the factory level rose 0.6% (3.7% y/y) in November, modestly firmer than October's 0.3% increase. Outside the transportation sector, they were up 0.5% (4.9% y/y) in November. Durable goods inventories gained 0.2% (3.5% y/y), the same as in October. Fabricated metals inventories strengthened 0.4% (6.1% y/y). Machinery inventories rose 0.2% (+5.5% y/y), reversing a 0.1% dip in October. Inventories of computers & electronic products picked up 0.5% (4.2% y/y). Nondurable goods inventories grew 0.6% (4.1% y/y) in November, equaling October's 0.6% rise. The value of petroleum refinery inventories rose 2.9% (24.0% y/y), again reflecting oil price increases. Apparel inventories fell 0.4% (-4.6% y/y) and textile product stocks were unchanged (3.0% y/y). Food product inventories edged down 0.1% (+0.7% y/y).
All these factory sector figures are available in Haver's USECON database.
Factory Sector- NAICS Classification (%) | Nov | Oct | Sep | Nov Y/Y | 2016 | 2015 | 2014 |
---|---|---|---|---|---|---|---|
New Orders | 1.3 | 0.4 | 1.7 | 8.6 | -1.9 | -7.7 | 1.8 |
Shipments | 1.2 | 0.8 | 1.1 | 7.8 | -1.8 | -5.8 | 1.3 |
Unfilled Orders | 0.1 | 0.1 | 0.3 | 0.7 | -1.9 | -2.0 | 8.4 |
Inventories | 0.4 | 0.3 | 0.6 | 3.7 | 0.7 | 0.0 | 1.7 |