Global| Jun 24 2010U.S. Durable Goods Orders Crash With Aircraft
by:Tom Moeller
|in:Economy in Brief
Summary
For the second month in a row the durable goods orders numbers from the Commerce Department were heavily influenced by a swing in commercial aircraft bookings, last month to the downside. The advance reading of durable goods orders [...]
For the second month in a row the durable goods orders numbers from the Commerce
Department were heavily influenced by a swing in commercial aircraft
bookings, last month to the downside. The advance reading of durable
goods orders was a 1.1% decline following a little-revised 3.0%
April increase. The drop roughly matched Consensus expectations.
Nondefense aircraft orders, however, accounted for the decline with a
near one-third decline (+20.3% y/y) after they more-than tripled in
April.
For the nondefense capital goods sector overall May orders fell 2.8% after the 8.2% April jump. Conversely, a 2.1% gain in orders less aircraft reversed nearly all of the April decline. Machinery orders gained 5.6% (20.8% y/y) and reversed April's decline while computer orders rebounded 2.5% (+13.0% y/y) after a sharp 5.9% April drop. Electrical equipment orders were roughly unchanged (+14.6% y/y).
Shipments of durable goods exhibited improvement with a 0.4% downtick (+11.2% y/y) after near 2.0% gains during the prior two months. A 3.2% May rise (8.8% y/y) in machinery shipments was offset by a 3.2% decline in shipments of computers (+11.6% y/y). Shipments of electrical equipment nudged up 0.3% (8.5% y/y) and primary metals shipments increased 1.0% m/m (52.1% y/y).
Inventory accumulation continued behind the improvement in orders & shipments. Durable goods inventories rose 0.8% (-3.1% y/y) for the fourth consecutive strong monthly increase. Nevertheless, inventories remained 11.5% below the late-2008 peak. Finally, backlogs of durable goods orders inched up 0.2% last month but remained down 3.2% y/y.
The durable goods figures are available in Haver's USECON database.
The press release following yesterday's FOMC meeting can be found here.
| NAICS Classification (%) | May | April | March | Y/Y | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Durable Goods Orders | -1.1 | 3.0 | 0.1 | 14.9 | -20.7 | -9.0 | 9.7 |
| Excluding Transportation | 0.9 | -0.8 | 4.9 | 17.6 | -18.4 | -2.5 | 4.5 |
| Nondefense Capital Goods | -2.8 | 8.2 | -2.8 | 18.5 | -26.8 | -12.6 | 17.5 |
| Excluding Aircraft | 2.1 | -2.7 | 6.7 | 17.3 | -19.8 | -4.2 | 5.3 |
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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