• Fall in orders is broad-based and likely reflects severe winter weather.

• Orders of core capital goods reverse January gain.

• Shipments weaken but order backlogs & inventories rise.

Manufacturers' orders for durable goods declined 1.1% (+3.2% y/y) during February following a 3.5% January gain, revised from 3.4%. A 0.6% Improvement had been expected in the Action Economics Forecast Survey. The latest decline followed nine consecutive monthly increases.

Orders for nondefense capital goods excluding aircraft fell 0.8% (+9.1% y/y) following a 0.6% January rise, initially reported as 0.5%. The decline also followed increases in each of the nine prior months.

In the major categories of the report, primary metals and fabricated metals orders weakened, posting 0.5% (+6.4% y/y) and 0.9% (+6.5% y/y) declines, respectively. Machinery orders eased 0.6% (+5.9% y/y) while computer & electronic product orders weakened 0.5% (+8.9% y/y) for a second consecutive month. Orders for electrical equipment rose 0.2% (7.3% y/y) but transportation equipment bookings declined 1.6% (-5.8% y/y), reflecting an 8.7% drop (-3.0% y/y) in motor vehicle & parts orders.

Shipments of durable goods fell 3.5% (+1.5% y/y) following sharp increases in the prior two months. Shipments of core capital goods fell 1.0% (+7.7% y/y) in February, also after two months of strong gains. Shipments of transportation products declined 8.2% (-7.3% y/y) as auto and aircraft shipments fell sharply. Shipments excluding transportation weakened 1.2% (+6.1% y/y) after increasing in each month since May.

Unfilled orders for durable goods surged 0.8% (-5.8% y/y) in February after a 0.2% January increase. Order backlogs, excluding transportation, rose 0.9% (5.7% y/y), following nine consecutive months of gains.

Inventories of durable goods rose 0.7% (1.1% y/y) in February, after two consecutive monthly declines. Excluding transportation, inventories increased 0.7% (-0.0% y/y) and have been rising for six consecutive months.

The durable goods figures are available in Haver's USECON database. The Action Economics consensus forecast figure is in the AS1REPNA database.