Global| Jul 27 2005U.S. Durable Goods Orders Firm, Revisions Positive
by:Tom Moeller
|in:Economy in Brief
Summary
New orders for durable goods added 1.4% last month to the upwardly revised 6.4% jump in May. Consensus expectations had been for a 1.0% decline. Strength in the factory sector was quite apparent in a 2.6% rise in durable goods orders [...]
New orders for durable goods added 1.4% last month to the upwardly revised 6.4% jump in May. Consensus expectations had been for a 1.0% decline.
Strength in the factory sector was quite apparent in a 2.6% rise in durable goods orders outside of the transportation sector as well as a 0.9% gain in these orders in May, revised up from a 0.2% decline reported initially. Computer & electronic equipment orders jumped 8.6% (19.0% y/y) after a 1.5% May rise, initially reported as a 1.2% decline. Orders for communication equipment surged 18.3% and were one third higher than last year.
Machinery orders jumped 3.7% (11.9% y/y) but with a 0.1% decline (+13.1% y/y) electrical equipment orders gave back a piece of the very much upwardly revised 3.4% spurt in May.
Orders for aircraft & parts fell just 22.1% (+49.8% y/y) following the more-than-doubling of orders in May while orders for motor vehicles & parts slipped 0.1% (-2.3% y/y).
Non-defense capital goods orders slipped due to the decline in aircraft but less aircraft orders posted the strongest monthly gain since January. Nevertheless, shipments of nondefense capital goods less aircraft fell 0.4% (+10.1% y/y). The decline in shipments followed gains of 1.2% and 1.5% during the prior two months.
Durable inventories fell 0.3% (+7.1% y/y) for the second monthly decline in the last three while May's gain was revised lower to just 0.1%.
Unfilled orders jumped another 2.6% (9.8% y/y) but outside of the transportation sector backlogs rose a lesser 1.6% (9.2% y/y). The ratio of backlogs to shipments outside of transportation rose to the highest level in over a year.
| NAICS Classification | June | May | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Durable Goods Orders | 1.4% | 6.4% | 11.8% | 10.8% | 2.6% | -1.7% |
| Excluding Transportation | 2.6% | 0.9% | 10.6% | 13.1% | 3.2% | -4.2% |
| Nondefense Capital Goods | -1.9% | 16.1% | 25.7% | 13.7% | 5.6% | -7.2% |
| Excluding Aircraft | 3.8% | -0.6% | 13.0% | 11.7% | 6.6% | -7.1% |
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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