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Economy in Brief

U.S. Factory Orders, Shipments & Inventories Ease Ahead of Coronavirus
by Tom Moeller  April 2, 2020

Factory orders fell slightly (+0.1% y/y) during February following a 0.5% January decline. The Action Economics Forecast Survey expected a 0.2% gain. Durable goods orders jumped 1.2% (-0.0% y/y) following a 0.1% improvement. Machinery orders eased 0.6% (-2.6% y/y) but electrical machinery orders jumped 1.3% (3.2% y/y). Orders for computers & electronic products fell 0.7% (-0.2% y/y). Orders for nondurable products, which equal shipments, declined 1.2% (+0.3% y/y) as the value of petroleum refinery shipments fell 4.1% (-2.8% y/y), down sharply for the second straight month due to lower prices. Basic chemical shipments fell 0.4% (+1.8% y/y) but apparel shipments declined 2.4% (-0.9% y/y).

Shipments of durable goods rose 0.9% (-2.4% y/y) as transportation shipments increased 2.9% (-5.2% y/y). Shipments outside of the transportation sector fell 0.8% (-0.2% y/y). Machinery shipments were off 1.3% (-3.4% y/y) while electrical equipment & appliance shipments improved 1.6% (2.7% y/y). Transportation sector shipments strengthened 2.9% (-5.2% y/y) as nondefense aircraft shipments rebounded 17.5%. They remained down by one third y/y. Shipments of computers & electronic products rose 0.3% (-0.6% y/y).

Unfilled orders for manufactured products improved 0.1% (-1.7% y/y) after holding steady for two consecutive months. Transportation sector backlogs rose 0.2% (-2.3% y/y). Excluding transportation, unfilled orders eased 0.2% (-0.6% y/y). Machinery backlogs rose 0.1% (-3.5% y/y) while computer & electronic equipment order backlogs fell 0.1% (+0.6% y/y). Electronic equipment & appliance order backlogs rose 0.2% (6.7% y/y).

Factory sector inventories declined 0.4% (+1.6% y/y). Transportation equipment inventories rose 0.4% (13.0% y/y) but auto inventories fell 2.8% (+6.9% y/y). Excluding the transportation sector, inventories fell 0.6% (-1.1% y/y). Electrical equipment inventories were off 0.2% (+1.1% y/y) while computer & electronic product inventories slipped 0.8% (+0.2% y/y). Nondurable product inventories fell 0.9% (-1.5% y/y) as the value of petroleum refinery stockpiles dropped 6.1% (-4.8% y/y). Apparel inventories eased 0.6% (-3.3% y/y) and food product inventories rose slightly (1.0% y/y).

The factory sector figures are available in Haver's USECON database. The expectation figure is in the AS1REPNA database.

Factory Sector (% chg) - NAICS Classification Feb Jan Dec Feb Y/Y 2019 2018 2017
New Orders -0.0 -0.5 1.9 0.1 -0.5 7.3 5.7
Shipments -0.2 -0.6 0.5 -1.1 0.7 6.9 5.0
Unfilled Orders 0.1 0.0 0.0 -1.7 -2.1 3.9 1.9
Inventories -0.4 -0.3 0.4 1.6 3.1 3.5 4.5
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