Global| Oct 24 2019U.S. Durable Goods Orders Falter; Core Capital Goods Orders Drop Again
by:Tom Moeller
|in:Economy in Brief
Summary
Manufacturers' orders for durable goods declined 1.1% (-5.4% y/y) during September following a 0.3% August rise, revised from 0.2%. A 0.9% decline had been expected in the Action Economics Forecast Survey. Orders for nondefense [...]
Manufacturers' orders for durable goods declined 1.1% (-5.4% y/y) during September following a 0.3% August rise, revised from 0.2%. A 0.9% decline had been expected in the Action Economics Forecast Survey. Orders for nondefense capital goods excluding aircraft, a key indicator of business investment plans, fell 0.5% last month after a 0.6% decline. During the past year, these orders have eased 0.8%, following double-digit y/y growth late in 2017.
The level of durable goods orders overall was pulled lower by a 2.7% decline (-14.3% y/y) in transportation sector orders. Orders for commercial aircraft & parts dropped 11.8% after a 17.8% August decline. Motor vehicle & parts orders fell 1.6% (+0.1% y/y) for the second straight month.
Orders outside of the transportation sector eased 0.3% in September and reversed the prior month's increase. These orders were unchanged y/y compared to 9.0% y/y growth early last year. Primary metals orders rose 0.3% (-5.5% y/y). Fabricated metals orders declined 1.5%, but improved by a lessened 2.5% y/y. Electrical equipment & appliance orders rose 0.9% and y/y growth was fairly steady at 4.2%. Machinery orders rose 0.2% but fell 1.5% y/y. Orders for computers & electronic products declined 0.9% last month (-0.4% y/y). Annual growth was double-digit as of June of last year. Computer & related product orders surged 1.4%, but fell 11.0% y/y. Communications equipment orders improved 1.5% (0.2% y/y) after two months of sharp decline.
Durable goods shipments declined 0.4% (-1.0% y/y), down for the third straight month. Shipments outside of transportation held steady, and y/y growth of 0.8% compared to 8.7% as of July of 2018. Unfilled orders were fairly steady (-1.8% y/y). Order backlogs outside of transportation also were stable. Year-to-year growth of 0.5% compared to 5.6% as of August 2018. Inventories rose an accelerated 0.5% (4.7% y/y). Outside of the transportation sector, inventories held steady (1.5% y/y) with transportation sector inventories up 11.6% y/y.
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 | Sep | Aug | Jul | Sep Y/Y | 2018 | 2017 | 2016 |
|---|---|---|---|---|---|---|---|
| New Orders (SA, % chg) | -1.1 | 0.3 | 2.1 | -5.4 | 7.9 | 5.4 | -1.7 |
| Transportation | -2.7 | 0.2 | 7.3 | -14.3 | 9.8 | 3.2 | -0.6 |
| Total Excluding Transportation | -0.3 | 0.3 | -0.5 | 0.0 | 6.9 | 6.5 | -2.3 |
| Nondefense Capital Goods | -2.8 | -3.1 | 5.2 | -9.1 | 5.5 | 9.1 | -5.8 |
| Excluding Aircraft | -0.5 | -0.6 | 0.0 | -0.8 | 6.0 | 6.7 | -4.5 |
| Shipments | -0.4 | -0.1 | -1.2 | -1.0 | 7.1 | 4.0 | -2.3 |
| Unfilled Orders | -0.0 | 0.2 | 0.1 | -1.8 | 3.9 | 1.9 | -1.1 |
| Inventories | 0.5 | 0.2 | 0.4 | 4.7 | 4.8 | 4.5 | -3.0 |
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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