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Economy in Brief
U.S. Trade Deficit Widens to $68.2 Billion in January
The U.S. trade deficit in goods and services widened to $68.2 billion in January...
U.S. Factory Orders & Shipments Rise Again in January
Manufacturing activity is strengthening. Factory orders rose 2.6% (2.8% y/y) in January...
U.S. Initial Unemployment Insurance Claims Rise Just 9,000
Initial claims for unemployment insurance rose modestly by 9,000 to 745,000 in the week ended February 27...
U.S. Productivity's Decline Lessened in Q4'20; Reverses Q3 Increase
Revisions to nonfarm business sector productivity indicated a 4.2% decline during Q4'20...
EMU Unemployment Rate Steadies in January
The overall EMU unemployment rate was steady in January, off peak, but still elevated...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller November 3, 2020
• Factory orders rise for fifth straight month.
• Shipments gain steadily.
• Order backlogs slip while inventories hold steady, again.
Activity in the factory sector continues to recover. Manufacturers' orders strengthened 1.1% during September following a 0.6% August rise, revised from 0.7%. A 0.9% gain had been expected in the Action Economics Forecast Survey. The 3.9% y/y orders decline during September compares to a 5.9% y/y shortfall in factory sector production.
Orders in the durable goods sector improved 1.9% (-1.8% y/y), unrevised from last week's advance report. That followed a 0.4% August gain. Both increases were sharply below the gains logged early in the recovery. The rise was boosted by a 4.1% increase in transportation sector bookings as nondefense aircraft orders surged. Shipments of durable goods rose 0.4% (-0.5% y/y). For more details on the durable goods sector, see last week's report.
Factory shipments rose 0.3% (-3.3% y/y) in September for the second straight month. Nondurable goods shipments, which equal nondurable goods orders, increased 0.3% (-6.0% y/y) after rising 0.8% during August. Apparel shipments surged 4.9% (-2.5% y/y) following a 3.6% drop. Textile product shipments also were strong, posting a 2.7% rise (-6.1% y/y) after a 4.1% jump. Elsewhere, shipments were mixed. Food product shipments rose 0.3% (0.6% y/y) and paper product shipments edged just 0.1% higher (1.6% y/y). Shipments from petroleum refineries eased 0.1% (-29.1% y/y).
Unfilled orders of durable goods weakened 0.2% (-6.3% y/y), off for the sixth month this year. Transportation equipment backlogs fell 0.7% (-9.5% y/y). Excluding the transportation sector, unfilled orders increased 0.7% (0.9% y/y). Computer & electronic backlogs held steady (0.5% y/y) while machinery grew 0.6% (1.4% y/y).
Inventories of manufactured products were unchanged in September (-1.2% y/y) as durable goods inventories, which are roughly 60% of total inventories, rose 0.3% (0.6% y/y). Transportation increased 0.6% (8.2% y/y). Inventories outside of transportation edged down 0.1% (-3.6% y/y) for the second straight month. Nondurable goods inventories were off 0.5% (-4.0% y/y) as petroleum refinery inventories fell 6.2% (-21.7% y/y). Apparel inventories fell 0.6% (-3.7 y/y), off for the fifth strait month.
All these factory sector figures and West Texas intermediate oil prices are available in Haver's USECON database.
Factory Sector (% chg) - NAICS Classification | Sep | Aug | Jul | Sep Y/Y | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
New Orders | 1.1 | 0.6 | 6.5 | -3.9 | -0.1 | 6.8 | 5.9 |
Shipments | 0.3 | 0.3 | 4.7 | -3.3 | 1.0 | 6.6 | 4.7 |
Unfilled Orders | -0.2 | -0.6 | -0.7 | -6.3 | -1.8 | 3.9 | 2.8 |
Inventories | 0.0 | 0.0 | -0.6 | -1.2 | 2.8 | 3.6 | 4.2 |