Recent Updates
- Korea: First 10 Days of Trade (Dec), Money Supply, Issued and Outstanding Bonds (Oct)
- Japan: Corporate Goods Price Index (Nov)
- Australia: WMI Consumer Sentiment - Regional (Dec)
- Australia: WMI Consumer Sentiment, Unemployment
- more updates...
Economy in Brief
U.S. Productivity Weakness Revised Little; Unit Labor Costs Still Firm
Productivity growth in the nonfarm business sector last quarter was revised to -0.2% at an annual rate (+1.5%) y/y...
U.S. Gasoline and Nat Gas Prices Fall While Crude Oil Prices Were Mixed
In the week ended December 9, retail gasoline prices edged down to $2.56 per gallon (+5.8% y/y)...
ZEW Assessments and Expectations Improve But Gain Less Markedly
The ZEW global macroeconomic assessments have improved along a broad front in December following a surge of improvement in November...
NABE Projections for Moderate Growth and Inflation Are Little Revised
The National Association for Business Economics expectations of 1.8% growth in real GDP during 2020...
German Trade Data Tell a Tale of Two Germanys
Germany's October trade report is better than expected...
by Gerald D. Cohen February 27, 2019 Manufacturers' orders edged up 0.1% (2.4% year-on-year) in December following a slightly upwardly-revised 0.5% decline in November (this report was delayed as a result of the government shutdown). The Action Economics Forecast survey looked for a 0.5% rise. Factory shipments shrank 0.2% (4.1% y/y), the third consecutive monthly decrease. Despite this weakness, shipments rose at a 0.8% annual rate in Q4 as strong August data created a healthy starting point for the quarter.
Orders in the volatile durable goods sector increased 1.2% (3.4% y/y) after a 0.9% gain in November. Orders for transportation equipment rose 3.2% (3.2% y/y) due to a 28.4% takeoff in volatile civilian aircraft bookings (-27.2% y/y). Total factory orders excluding transportation declined 0.6% (+2.2% y/y). Fabricated metal orders continued its strong quarter up 0.4% in December (6.0% y/y). Machinery orders decreased 1.0% (-0.4% y/y) after a 2.0% drop. Orders for computers & electronic products edged up 0.1% (7.8% y/y).
Shipments of durable goods grew 0.7% (6.9% y/y) in December. Shipments of transportation equipment increased 1.6% (12.2% y/y) driven by a 2.5% gain in passenger car and light trucks (15.4% y/y). Fabricated metal shipments increased 1.1% (7.2% y/y), while machinery declined 0.5% (+1.5% y/y). Computer & electronic product shipments rose 0.6% (7.0% y/y).
Nondurable goods shipments, which equal nondurable goods orders because nondurables are shipped in the same period they are ordered, declined 1.0% (+1.4% y/y). This decrease was driven a 5.5% drop in shipments from petroleum refineries (-2.7% y/y). Energy prices, in particular oil prices, have a significant role on the value of energy product activity in this report. West Texas intermediate oil prices plummeted 15.1% in the year ending December. Orders for the largest nondurable category, basic chemicals, rose 0.3% (4.1% y/y), food products, the second largest, decreased 0.3% (0.6% y/y).
Unfilled orders of durable goods, which as implied above equals unfilled factory orders, edged down 0.1% (+3.8% y/y). Transportation equipment backlogs decreased 0.2% (+3.5% y/y). Excluding the transportation sector, unfilled orders inched up 0.1% (4.6% y/y). Non-transportation unfilled orders have been on a steady rise since early 2017. Computer & electronic sector backlogs increased 0.3% (3.8% y/y), while machinery declined 0.3% (+2.3% y/y).
Inventories of manufactured products were unchanged in December (3.4% y/y) as durable goods inventories - which are roughly 60% of total inventories - rose 0.3% (4.6% y/y). Transportation ticked down 0.1% (+2.7% y/y). Inventories outside of transportation were unchanged (3.5% y/y). The machinery sector rose 0.3% (5.0% y/y) and fabricated metals increased 0.2% (7.8% y/y). Nondurable goods inventories declined 0.4% (+1.6% y/y) as petroleum refineries dropped 5.2% (-7.9% y/y). Basic chemical inventories decreased 0.3% (+4.3% y/y), while food product inventories grew 0.4% (-1.8% y/y).
All these factory sector figures and West Texas intermediate oil prices are available in Haver's USECON database.
Factory Sector (% chg) - NAICS Classification | Dec | Nov | Oct | Dec Y/Y | 2018 | 2017 | 2016 |
---|---|---|---|---|---|---|---|
New Orders | 0.1 | -0.5 | -2.1 | 2.4 | 7.2 | 5.7 | -2.9 |
Shipments | -0.2 | -0.5 | -0.1 | 4.1 | 6.8 | 5.0 | -3.2 |
Unfilled Orders | -0.1 | -0.2 | -0.2 | 3.8 | 3.8 | 2.0 | -1.2 |
Inventories | 0.0 | -0.1 | 0.2 | 3.4 | 3.4 | 4.5 | -0.7 |