Global| May 25 2018U.S. Durable Goods Orders Decline; Core Capital Goods Bookings Strengthen
by:Tom Moeller
|in:Economy in Brief
Summary
New orders for durable goods fell 1.7% (7.8 y/y) during April following a 2.7% March increase, revised from 2.6%. Expectations had been for a 1.2% decline in the Action Economics Forecast Survey. A 6.1% decline (+7.7% y/y) in orders [...]
New orders for durable goods fell 1.7% (7.8 y/y) during April following a 2.7% March increase, revised from 2.6%. Expectations had been for a 1.2% decline in the Action Economics Forecast Survey.
A 6.1% decline (+7.7% y/y) in orders for transportation equipment pulled the overall figure lower. It reversed the 6.9% rise in March. Aircraft orders alone declined 24.0%. They were accompanied, however, by a 1.8% rise in orders for motor vehicles and parts. Excluding the transportation sector altogether, durable goods orders rose 0.9% following a 0.4% rise. It was the third consecutive monthly increase.
Orders for nondefense capital goods declined 6.8% (+8.5% y/y) and reversed most of the 8.8% rise during March. Orders excluding aircraft increased by 1.0%, however, and reversed the 0.9% March decline. The level of orders has risen 13.4% from its low in May 2016. Defense capital goods orders increased 7.5% (-29.5% y//y) and reversed the prior month's 7.8% decline.
Within the other durable goods sectors, electrical equipment bookings improved 2.6% (8.1% y/y), about as they did in each of the prior two months. Fabricated metals orders increased 2.0% (12.0% y/y) following a 1.2% gain. Orders for primary metals increased 1.3% (17.4% y/y) following even stronger increases in both of the prior two months. Computer & electronic equipment orders rose 1.1% (8.0% y/y) following a 1.5% rise. That rise was powered by a 5.3% strengthening in orders for computers & related products which remained down by 12.2% y/y. Machinery orders declined 0.8% (+2.5% y/y) after a 3.2% drop.
Shipments of durable goods eased 0.1% (+7.3% y/y) owing to a 2.1% decline (+5.5% y/y) in transportation equipment. Shipments excluding transportation equipment rose 1.0% (8.2% y/y). Unfilled durable orders rose 0.5% (3.7% y/y), up for the fourth month in the last five. Backlogs excluding the transportation sector gained 0.4% (4.7% y/y) as they did in March. Durable goods inventories increased 0.3% (4.9% y/y) after a 0.2% gain. Inventories outside of the transportation sector rose 0.3% (5.7% y/y) following two months of 0.5% increase.
The durable goods figures are available in Haver's USECON database. The Action Economics consensus forecast figure is in the AS1REPNA database.
| Durable Goods NAICS Classification | Apr | Mar | Feb | Apr Y/Y | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|
| New Orders (SA, % chg) | -1.7 | 2.7 | 4.5 | 7.8 | 5.4 | -1.7 | -4.6 |
| Transportation | -6.1 | 6.9 | 10.8 | 7.7 | 3.4 | -0.7 | -6.3 |
| Total Excluding Transportation | 0.9 | 0.4 | 1.3 | 7.9 | 6.5 | -2.3 | -4.2 |
| Nondefense Capital Goods | -6.8 | 8.8 | 3.5 | 8.5 | 9.1 | -5.8 | -11.8 |
| Excluding Aircraft | 1.0 | -0.9 | 1.6 | 5.9 | 6.7 | -4.5 | -5.5 |
| Shipments | -0.1 | 0.7 | 0.7 | 7.3 | 4.0 | -2.4 | -0.8 |
| Unfilled Orders | 0.5 | 0.8 | 0.4 | 3.7 | 2.0 | -1.2 | -2.7 |
| Inventories | 0.3 | 0.2 | 0.5 | 4.9 | 4.6 | -3.0 | 0.9 |
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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