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Economy in Brief
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In January, the ZEW index paints a mixed and somewhat uneven view of its survey universe...
U.S. Housing Affordability Improves During November
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U.S. Retail Sales Continue to Fall During December as COVID-19 Cases Increase
Total retail sales declined 0.7% (+2.9% y/y) during December...
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U.S. Industrial Production Continues Recovery
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Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller September 2, 2020
• Factory orders strength is broad-based.
• Motor vehicle shipments are exceptionally strong.
• Inventory decumulation is widespread.
New orders for manufactured goods increased 6.4% (-6.2% y/y) during July and repeated the June gain, revised from 6.2%. A 5.8% rise had been expected in the Action Economics Forecast Survey. Orders for durable goods increased 11.4% (-4.8% y/y), revised from 11.2% in the advance report issued last month. Transportation equipment orders rose 35.7% (-12.4% y/y). Motor vehicle orders improved 9.4% (3.1% y/y) and defense aircraft bookings strengthened by three-quarters (+16.8% y/y). Electrical equipment & appliance orders rose 4.1%, but fell by the same degree y/y. Orders for fabricated metals rose strongly while machinery orders gained 2.0% (-3.2% y/y).
Nondurable goods orders, which equal shipments, rose 1.8% in July (-7.5% y/y). Shipments from petroleum refineries strengthened 7.5% (-33.8% y/y) as prices rose. Food product shipments edged 0.7% higher (1.2% y/y). Textile product shipments declined 2.8% (-13.4% y/y) but apparel shipments improved 1.0% (-4.0% y/y). Shipments of basic chemicals rose 1.1% (0.6% y/y) after rising 2.7% in June. Shipments of durable goods strengthened 7.5% (-1.3% y/y) as transportation shipments surged 17.9% (-2.9% y/y) with strength in the motor vehicle sector. Factory shipments excluding transportation rose 2.2% (-4.8% y/y). Electrical equipment & appliance shipments rose 2.0% (-4.3% y/y) for a second straight month while shipments of furniture improved 0.7% (-1.0% y/y).
Order backlogs declined 0.8% (-5.5% y/y), off for the fourth month in the last five. Transportation backlogs fell 1.1% (-7.7% y/y). Excluding the transportation sector, unfilled orders improved 0.1% (-0.3% y/y) for a second straight month. Order backlogs of electrical equipment & appliances rose 1.1% (4.9% y/y). Unfilled orders for computers & electronic products eased 0.1% (+0.9% y/y). Machinery order backlogs rose marginally (-0.4% y/y) for a second month.
Inventories of manufactured products fell 0.5% in July (-1.0% y/y). The decline was the first in three months. Transportation sector inventories eased slightly (+10.2% y/y), while outside transportation, inventories were off 0.6% (-3.7% y/y). Furniture inventories fell 0.8% (-3.9% y/y) and electrical equipment & appliance inventories eased 0.2% (-0.5% y/y). Computer & electronic product inventories fell 0.5% (+0.5% y/y) while machinery inventories declined 1.1% (-3.8% y/y), off for the sixth month this year. Inventories of nondurable products declined 0.2% (-4.5% y/y) as petroleum refinery inventories eased 0.2% (-21.9% y/y). Apparel inventories edged 0.1% lower (-1.8% y/y) but food product inventories improved 0.1% (-1.9% 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 | Jul | Jun | May | Jul Y/Y | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
New Orders | 6.4 | 6.4 | 7.7 | -6.2 | -0.2 | 6.9 | 5.6 |
Shipments | 4.6 | 10.0 | 3.0 | -4.4 | 0.9 | 6.7 | 4.4 |
Unfilled Orders | -0.8 | -1.4 | 0.0 | -5.5 | -1.9 | 3.8 | 2.7 |
Inventories | -0.5 | 0.5 | 0.2 | -1.0 | 2.8 | 3.7 | 4.3 |