U.S. Durable Goods Orders Strengthen Unexpectedly During June
by:Tom Moeller
|in:Economy in Brief
Summary
• Nondefense capital goods orders excluding aircraft improve steadily.
• Transportation equipment orders surge.
• Order backlogs & inventories increase.
Manufacturers' new orders for durable goods continued to exhibit surprising improvement in June. A 1.9% rise (10.9% y/y) followed a 0.8% May gain, revised from 0.7%. The increase contrasted with expectations for a 0.3% decline in the Action Economics Forecast Survey.
New orders for nondefense capital goods excluding aircraft, a key measure of capital goods spending, rose 0.5% (8.4% y/y), the same as during May which was unrevised.
Transportation equipment orders surged 5.1% (18.9% y/y) after a 1.5% May increase. Motor vehicle & parts orders increased 1.5% (19.0% y/y) after a 1.2% improvement. Defense aircraft orders jumped 80.6% (122.3% y/y) after rising 9.8% in May.
Excluding transportation, orders rose 0.3% (7.2% y/y) in June following a 0.5% May improvement. Electrical equipment & appliance orders rebounded 2.5% (7.5% y/y) after falling 0.6% in May. Computer & electronic product orders improved 1.5% (5.9% y/y) after rising 0.2% in May. Fabricated metals orders rose 0.3% (6.2% y/y) after easing 0.2%, but primary metals bookings fell 1.1% (+10.8% y/y) after a 2.0% gain. Orders for machinery eased 0.2% (9.1% y/y) following a 1.3% increase.
Shipments of durable goods edged 0.3% higher (12.2% y/y) after a 1.5% May improvement. Transportation shipments were little changed (16.4% y/y) following a 2.5% rise. Excluding transportation, shipments improved 0.4% (10.4% y/y) during June after rising 1.1% in May.
The advance reading on shipments of nondurable goods indicated a 2.0% June gain (17.4% y/y) following a 2.7% rise. Shipments from all manufacturing industries rose 1.1% (14.8% y/y) in June after a 2.1% May improvement. Capital goods shipments excluding defense and aircraft increased 0.7% (11.4% y/y) in June after rising 1.0% in May.
Unfilled orders for durable goods rose 0.7% last month (7.0% y/y) following a 0.3% May rise. Unfilled orders are not calculated for nondurable goods.
Durable goods inventories increased 0.4% (9.1% y/y) following a 0.6% May gain. Nondurable goods inventories rose 0.4% in June (12.5% y/y) after a 2.4% May increase.
The durable goods and nondurable goods data are available in Haver's USECON database. The Action Economics consensus forecast figure is in the AS1REPNA database.
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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