Global| Feb 27 2014U.S. Durable Goods Order Decline Reflects a Weaker Transportation Sector
by:Tom Moeller
|in:Economy in Brief
Summary
New orders for durable goods fell 1.0% during January (+4.6 y/y) following a 5.3% December drop, revised from a 4.3% decline. The latest decline matched expectations in the Action Economics Forecast Survey. A 5.6% drop (+13.6% y/y) in [...]
New orders for durable goods fell 1.0% during January (+4.6 y/y) following a 5.3% December drop, revised from a 4.3% decline. The latest decline matched expectations in the Action Economics Forecast Survey. A 5.6% drop (+13.6% y/y) in orders for transportation equipment weighed on last month's total. Nondefense aircraft & parts orders fell 20.2% (+56.7% y/y) after December's 22.3% shortfall. Motor vehicle & parts orders also softened, posting a 2.2% drop last month (+3.8% y/y) on the heels of a 6.6% decline.
Outside of the transportation sector, new orders showed mixed performance as a 1.1% gain (1.2% y/y) countered December's 1.9% decline. Fabricated metal orders led the increase with a 7.3% rise (-9.1 y/y). Orders for computers & electronic products followed with a 4.7% rise (1.7% y/y). Working to the downside, primary metal orders were off 2.3% (+7.0% y/y and electrical equipment, appliances & components orders declined 2.1% (+3.7% y/y). Machinery orders slipped 0.4% (+1.5% y/y). Nondefense capital goods orders fell 3.9% (+5.6% y/y) reflecting the weakened aircraft bookings. Excluding aircraft, however, orders improved 1.7% (-0.8% y/y) and reversed December's decline.
Shipments of durable goods were off 0.4% (+3.4% y/y) in January following December's 1.8% fall. Shipments excluding the transportation sector slipped 0.5% (+2.7% y/y), the first material decline in nine months. Unfilled orders ticked 0.1% higher (7.1% y/y) while order backlogs outside of the transportation sector gained 0.3% (5.7% y/y). Inventories of durable goods improved 0.3% (3.7% y/y) after December's 0.9% jump. Inventories outside the transportation sector were roughly unchanged (1.4% y/y).
The durable goods figures are available in Haver's USECON database. The Action Economics consensus forecast figure is in the AS1REPNA database.
Semiannual Monetary Policy Report to the Congress by Fed Chair Janet L. Yellen can be found here.
| Durable Goods NAICS Classification | Jan | Dec | Nov | Y/Y | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|---|---|
| New Orders (SA, %) | -1.0 | -5.3 | 2.7 | 4.6 | 5.1 | 4.1 | 11.0 |
| Transportation | -5.6 | -12.0 | 8.1 | 13.6 | 7.7 | 8.9 | 14.9 |
| Total Excluding Transportation | 1.1 | -1.9 | 0.2 | 1.2 | 3.9 | 2.1 | 9.5 |
| Nondefense Capital Goods | -3.9 | -6.5 | 8.2 | 5.6 | 8.6 | 3.7 | 15.3 |
| Excluding Aircraft | 1.7 | -1.8 | 3.0 | -0.8 | 5.1 | 2.1 | 11.6 |
| Shipments | -0.4 | -1.8 | 1.4 | 3.4 | 3.7 | 6.4 | 9.4 |
| Inventories | 0.3 | 0.9 | 0.3 | 3.7 | 3.7 | 4.5 | 10.8 |
| Unfilled Orders | 0.1 | 0.2 | 0.9 | 7.1 | 6.8 | 3.7 | 10.0 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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