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Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller April 24, 2020
• Durable goods orders weaken 14.4% in March, the sharpest decline since August 2014.
• Commercial aircraft orders plummet.
• Inventories surge.
Manufacturers' orders for durable goods fell 14.4% last month (-16.0% y/y) following a 1.1% February rise, revised from 1.2%. An 11.1% decline had been expected in the Action Economics Forecast Survey.
Last month's orders weakness was paced by a 41.0% shortfall (-43.6% y/y) in transportation sector orders. It reflected a sharp drop in commercial aircraft bookings as well as an 18.4% weakening (-21.1% y/y) in motor vehicle and parts orders. Orders excluding the transportation sector eased 0.2% last month (-0.7% y/y) following a 0.7% decline.
Orders for electrical equipment & appliances rose 1.5% (3.9% y/y), about the same as they did in February. Offsetting this rise was a 0.1% easing (-1.5% y/y) in bookings for computers & electronic products. Machinery orders also slipped 0.2% (-1.2% y/y). Primary & fabricated metals orders also declined both m/m and y/y.
Shipments of durable goods weakened 4.5% (-6.5% y/y) as transportation shipments fell 12.8% (-17.2% y/y), paced by an 18.5% shortfall (-21.6% y/y) in motor vehicles & parts. Aircraft & parts shipments actually rose 5.3% (-19.4% y/y) in March. Shipments less transportation eased 0.3% (-0.7% y/y) for a second straight month. Nondefense capital goods shipments excluding aircraft shipments were off 0.2% (-1.0% y/y).
Unfilled orders for durable products declined 2.0% (-3.8% y/y). Order backlogs excluding transportation edged 0.1% lower (-0.5% y/y), off slightly for the fifth straight month.
Durable goods inventories increased 0.6% (4.0% y/y) last month, the largest rise since September 2018. Transportation sector inventories also rose 0.6% (13.4% y/y) while durable goods inventories less transportation gained 0.6%, but declined 0.5% 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 % | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
New Orders (SA, % chg) | -14.4 | 1.1 | 0.1 | -16.0 | -1.2 | 7.9 | 5.4 |
Transportation | -41.0 | 4.6 | -1.0 | -43.6 | -4.3 | 9.8 | 3.2 |
Total Excluding Transportation | -0.2 | -0.7 | 0.7 | -0.7 | 0.4 | 6.9 | 6.5 |
Nondefense Capital Goods Excl. Aircraft | 0.1 | -0.8 | 1.0 | -0.7 | 0.9 | 6.0 | 6.7 |
Shipments | -4.5 | 0.8 | -0.0 | -6.5 | 1.2 | 7.1 | 4.0 |
Nondefense Capital Goods Excl. Aircraft | -0.2 | -0.9 | 1.1 | -1.0 | 2.1 | 6.3 | 5.6 |
Unfilled Orders | -2.0 | 0.1 | 0.0 | -3.8 | -2.1 | 3.9 | 1.9 |
Inventories | 0.6 | 0.0 | -0.2 | 4.0 | 4.7 | 4.8 | 4.5 |