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Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller August 2, 2018
Activity in the factory sector continues to improve. Manufacturers' orders increased 0.7% (6.1% y/y) during June following an unrevised 0.4% May increase. Manufacturing shipments surged 1.0% (8.4% y/y) after a 0.6% May rise.
Durable goods orders improved 0.8% (3.1% y/y), revised from 1.0% in last month's advance report. The rise followed a 0.3% May decline. Orders for transportation equipment jumped 2.1% in June (-6.2% y/y) due to a 20.2% surge in defense aircraft bookings. Nondefense aircraft orders rose 4.2% while motor vehicle & parts orders rose 0.9%. Total factory orders excluding transportation improved 0.4% (9.1% y/y). Machinery orders were little changed (+5.6% y/y) following a 4.6% rise. Orders for computers & electronic products rose 0.8% (10.4% y/y) and electrical equipment bookings gained 0.8% (8.4% y/y).
Nondurable goods orders, which equal shipments because nondurables are shipped when ordered, gained 0.5% (9.4% y/y) after a 1.1% jump. Petroleum shipments increased 0.8% (39.6% y/y) with higher prices. Food product shipments slipped 0.2% (+0.9% y/y) for the second straight month. Basic chemical shipments increased 0.8% (6.3% y/y) and paper product shipments gained 0.5% (6.8% y/y). Shipments of apparel rose 1.6% (7.6% y/y).
Shipments of durable goods strengthened 1.5% (7.5% y/y) last month after a 0.2% gain. Shipments of transportation products surged 3.7% (6.7% y/y) reflecting strength in truck shipments. Shipments of civilian aircraft rose 6.0% (8.0% y/y), but automobile shipments fell 0.7% (-9.2% y/y). Shipments outside of the transportation sector increased 0.5% (8.8% y/y) following a 0.9% rise. Machinery shipments improved 0.6% (7.1% y/y) after a 1.2% strengthening. Computer & electronic product shipments rose 0.1% (5.7% y/y). Electrical equipment & appliance shipments fell 0.3% (+4.4% y/y) for the second straight month.
Unfilled orders of durable goods rose 0.4% (3.6% y/y), up for the fifth consecutive month. Transportation equipment backlogs gained 0.3% (2.7% y/y). Excluding the transportation sector, unfilled orders rose 0.6% (5.7% y/y) following two straight 0.7% increases. Machinery backlogs improved 0.2% (3.2% y/y). Unfilled orders of computer & electronic products increased 0.6% (3.5% y/y) and electrical equipment & appliance backlogs rose 1.1% (1.9% y/y) after three straight months of moderate increase.
Inventories of manufactured products ticked 0.1% higher (5.1% y/y) after stronger monthly gains back through the middle of last year. Durable goods inventories slipped 0.1% (+4.6% y/y). Transportation product inventories declined 1.4% (+2.4% y/y). Outside of the transportation sector, inventories rose 0.5% (5.8% y/y), the strongest increase this year. Machinery sector inventories increased an accelerated 0.4% (4.9% y/y). Computer & electronic product inventories rose 0.4% (3.4% y/y). Nondurable goods inventories improved 0.4% (5.9% y/y). Basic chemical inventories rose 0.8% (3.8% y/y) but food product inventories eased 0.1% (-0.1% y/y), down for the third straight month. Petroleum refinery inventories rose 0.7% and by roughly one-third y/y.
All these factory sector figures are available in Haver's USECON database.
Factory Sector (% chg) - NAICS Classification | Jun | May | Apr | Jun Y/Y | 2017 | 2016 | 2015 |
---|---|---|---|---|---|---|---|
New Orders | 0.7 | 0.4 | -0.4 | 6.1 | 5.7 | -2.9 | -8.2 |
Shipments | 1.0 | 0.6 | 0.1 | 8.4 | 5.0 | -3.2 | -6.2 |
Unfilled Orders | 0.4 | 0.5 | 0.6 | 3.6 | 2.0 | -1.2 | -2.7 |
Inventories | 0.1 | 0.2 | 0.4 | 5.1 | 4.5 | -0.7 | -0.8 |