U.S. Factory Orders Rebound More Than Expected in July on Strong Nondefense Aircraft Orders
Summary
- Factory orders +0.9% (+9.9% y/y) in July, first m/m increase since Apr.; 15.2% above the Jan. ’24 low.
- Durable goods orders +1.1%, fourth m/m rise in five mths.; nondurable goods orders +0.7% and shipments +0.8%, seventh m/m gains in eight mths.
- Transportation orders +2.3%, led by a 12.7% jump in nondefense aircraft orders.
- Unfilled orders +0.6%, 12th straight m/m increase.
- Inventories +0.4%, ninth consecutive m/m rise.
Total factory orders rose a more-than-expected 0.9% m/m in July, the first monthly rise since April, reversing a 0.2% decline in June, according to data from the U.S. Census Bureau. The Action Economics Forecast Survey had expected a 0.5% m/m July increase. The year-on-year growth rate accelerated to 9.9% in July, the highest since April, from 7.6% in June (+1.6% in July 2025), while remaining far below the April 2021 peak of 39.6%. Factory orders excluding defense rebounded 1.0% (8.8% y/y), up for the first time in three months, following a 0.3% June decrease. Factory orders excluding the transportation sector rose 0.6% (9.2% y/y), the eighth m/m gain in nine months, after a 0.1% June downtick.
Notably, orders for nondefense aircraft & parts jumped 12.7% in July following a 2.9% decline in June and a 51.1% plunge in May; orders for defense aircraft & parts increased 4.9% (53.5% y/y), the fifth m/m rise in six months, after a 7.0% June drop and an 8.9% May gain. Additionally, orders for ships & boats climbed 5.3% in July after rising 7.5% and 3.5% in the prior two months.
Durable goods orders advanced 1.1% (12.0% y/y) in July after a 0.6% increase in June (matching +1.1% m/m in the advance report on August 26), marking the fourth m/m rise in five months. The July m/m gain was led by a 2.3% rebound (13.7% y/y) in transportation equipment, followed by increases of 2.0% (19.1% y/y) in primary metals, 0.8% (15.3% y/y) in machinery, 0.7% (1.6% y/y) in furniture & related products, and 0.6% (10.9% y/y) in fabricated metal products. In contrast, durable goods orders for computers & electronic products (-1.1%; +14.8% y/y) and electrical equipment, appliances & components (-0.3%; +6.7% y/y) declined m/m in July.
Nondurable goods orders, which equal nondurable goods shipments, rose 0.7% (7.9% y/y) in July, the seventh m/m gain in eight months, after a 0.9% decline in June. The July m/m increase was driven by a 2.4% rebound (+26.2% y/y) in petroleum & coal products, followed by rises of 1.7% (+2.3% y/y) in textile products, 1.2% (-0.5% y/y) in printing, 0.7% (+2.7% y/y) in paper products, 0.6% (+2.2% y/y) in beverage & tobacco products, 0.4% (-4.7% y/y) in textile mills, 0.1% (+7.7% y/y) in chemical products, 0.1% (+1.4% y/y) in food products, and 0.1% (+3.1% y/y) in plastics & rubber products. To the downside, nondurable goods shipments for leather & allied products (-1.9%; -1.0% y/y) and apparel (-0.5%; +5.5% y/y) fell m/m in July.
Total shipments increased 0.8% (8.3% y/y) in July, up for the seventh time in eight months, after no change in June. Excluding transportation, shipments rose 0.7% (8.1% y/y), the eighth m/m gain in nine months, following a 0.1% June easing. Shipments of durable goods industries grew 0.9% (8.6% y/y), the eighth straight m/m rise, after a 1.0% June increase. This reflected m/m gains in almost all durable goods shipments categories, led by a 2.9% advance (12.6% y/y) in machinery, alongside rises of 1.9% (16.8% y/y) in primary metals, 1.3% (9.1% y/y) in transportation equipment, 1.1% (2.4% y/y) in wood products, 0.8% (7.0% y/y) in miscellaneous durable goods, 0.7% (2.0% y/y) in furniture & related products, and 0.2% (6.6% y/y) in fabricated metal products. In contrast, durable goods shipments for computers & electronic products (-1.2%; +8.1% y/y) and nonmetallic mineral products (-0.7%; +1.5% y/y) fell m/m in July, while those for electrical equipment, appliances & components were virtually unchanged (+5.5% y/y) following five successive m/m increases.
Unfilled orders rose 0.6% (8.9% y/y) in July, the 12th consecutive m/m increase, after rising at the same pace in June. Excluding transportation, unfilled orders climbed 0.9% (6.4% y/y), also up for the 12th straight month, on top of a 1.0% June rise. Backlogs of durable goods grew 0.6% (8.9% y/y) in July, reflecting gains of 1.9% (8.2% y/y) in primary metals, 1.1% (6.8% y/y) in fabricated metal products, and 1.0% (5.9% y/y) in computers & electronic products, partially offset by a 0.2% decline (-2.2% y/y) in furniture & related products.
Inventories advanced 0.4% (2.0% y/y) in July, the ninth successive m/m rise, after a 0.1% uptick in June. Excluding transportation, inventories rose 0.4% (2.1% y/y), up for the sixth consecutive month, following a 0.1% June increase. Durable goods inventories grew 0.4% (2.3% y/y) in July, the 10th straight m/m gain, after a 0.4% rise in June, while nondurable goods inventories rebounded 0.3% (1.4% y/y), the fifth m/m increase in six months, following a 0.3% June decline.
The factory sector data are available in Haver’s USECON database. The Action Economics Forecast Survey is in the AS1REPNA database.
Winnie Tapasanun
AuthorMore in Author Profile »Winnie Tapasanun has been working for Haver Analytics since 2013. She has 20+ years of working in the financial services industry. As Vice President and Economic Analyst at Globicus International, Inc., a New York-based company specializing in macroeconomics and financial markets, Winnie oversaw the company’s business operations, managed financial and economic data, and wrote daily reports on macroeconomics and financial markets. Prior to working at Globicus, she was Investment Promotion Officer at the New York Office of the Thailand Board of Investment (BOI) where she wrote monthly reports on the U.S. economic outlook, wrote reports on the outlook of key U.S. industries, and assisted investors on doing business and investment in Thailand. Prior to joining the BOI, she was Adjunct Professor teaching International Political Economy/International Relations at the City College of New York. Prior to her teaching experience at the CCNY, Winnie successfully completed internships at the United Nations. Winnie holds an MA Degree from Long Island University, New York. She also did graduate studies at Columbia University in the City of New York and doctoral requirements at the Graduate Center of the City University of New York. Her areas of specialization are international political economy, macroeconomics, financial markets, political economy, international relations, and business development/business strategy. Her regional specialization includes, but not limited to, Southeast Asia and East Asia. Winnie is bilingual in English and Thai with competency in French. She loves to travel (~30 countries) to better understand each country’s unique economy, fascinating culture and people as well as the global economy as a whole.
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