Global| Jul 02 2021U.S. Factory Orders Surge and Shipments Improve in May
by:Tom Moeller
|in:Economy in Brief
Summary
• Orders increase paced by transportation. • Increased shipments largely reflect higher oil prices. • Order backlogs and inventories continue to rise. New orders for manufactured goods jumped 1.7% (30.4% y/y) during May following a [...]
• Orders increase paced by transportation.
• Increased shipments largely reflect higher oil prices.
• Order backlogs and inventories continue to rise.
New orders for manufactured goods jumped 1.7% (30.4% y/y) during May following a 0.1% dip in April, revised from -0.6%. It was the largest increase since January. The Action Economics Forecast Survey expected a 1.5% rise. The 1.4% gain in March was unrevised.
Durable goods orders surged 2.3% following a 0.7% April drop, revised from -1.3%. The May increase was unrevised from the advance report. Transportation sector orders rebounded 7.7% (106.6% y/y) following two months of sharp decline. Electrical equipment orders rose 1.3% (23.9% y/y) but machinery orders slipped marginally (+24.3% y/y).
Nondurable goods orders, which equal shipments, improved 1.0% (20.4% y/y) in May after rising 0.5% in April. Shipments from petroleum refineries surged 2.8% (125.9% y/y). Basic chemical shipments rose 1.0% (12.7% y/y) but apparel shipments eased 0.1% (+10.0% y/y). Textile product shipments rose 0.9% (15.9% y/y). Shipments of paper products edged 0.1% higher (8.9% y/y).
Shipments of durable goods rose 0.4% (31.6% y/y) in May after little change in April. Transportation equipment shipments fell 0.4% (+68.9% y/y) while shipments of furniture eased 0.2% (8.2% y/y). Electrical equipment shipments edged 0.1% higher (20.8% y/y) and computer & electronic product shipments fell 0.3% (+8.7% y/y).
Inventories of manufactured products rose 0.9% (4.8% y/y) in May following a 0.5% April gain. Transportation equipment inventories rose 0.1% (4.4% y/y) and excluding transportation inventories rose 1.1% (4.9% y/y). Durable goods inventories increased 0.7% (3.4% y/y) for a second straight month. Nondurable goods inventories rose 1.2% (7.1% y/y) as petroleum inventories increased 6.5% (50.1% y/y). Basic chemical inventories rose 0.5% (5.4% y/y) and apparel inventories rose 0.9% (-2.1% y/y).
The value of unfilled orders rose 0.8% (-1.4% y/y) in May after a 0.4% April gain. Unfilled orders of durable goods rose 1.8% (-1.4% y/y). In the transportation sector, they rose 0.4% (-6.9% y/y) and excluding transportation, backlogs jumped 1.6% (11.9% y/y). Electrical equipment order backlogs rose 1.7% (14.6% y/y).
The factory sector data are available in USECON database.
| Factory Sector (% chg) - NAICS Classification | May | Apr | Mar | May Y/Y | 2020 | 2019 | 2018 |
|---|---|---|---|---|---|---|---|
| New Orders | 1.7 | -0.1 | 1.4 | 30.4 | -10.4 | -0.2 | 5.7 |
| Shipments | 0.7 | 0.2 | 2.1 | 25.8 | -6.7 | -2.6 | 6.0 |
| Unfilled Orders | 0.8 | 0.4 | 0.5 | -1.4 | -8.2 | 10.2 | -1.6 |
| Inventories | 0.9 | 0.5 | 0.8 | 4.8 | -0.5 | 5.3 | 2.8 |
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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