New orders for durable goods fell 1.2% during September (-3.0% y/y) following a 3.0% August drop, revised from -2.0%. Expectations had been for a 1.0% decline in the Action Economics Forecast Survey. During the last ten years, there has been an 88% correlation between the y/y change in durable goods orders and the change in real GDP. Weakness in durable goods bookings was pervasive during both Q3 and Q2.

Last month's decline was paced by a 7.6% drop (-13.2% y/y) in orders for nondefense capital goods. A 35.7% drop (-37.2% y/y) in aircraft & parts led the decline. Nondefense capital goods orders excluding aircraft & parts eased 0.3% (-7.3% y/y) after a 1.6% shortfall. Elsewhere in the transportation sector, motor vehicle & parts orders increased 1.8% (13.1% y/y). Overall orders excluding the transportation sector eased 0.4% (-5.3% y/y). They improved 0.2% during all of last quarter after a 0.6% dip in Q2.

In most other durable goods sectors, orders were soft. Primary metals orders fell 2.9% (-18.7% y/y), the fourth decline in as many months. Fabricated metals orders did rise 1.7% (-3.9% y/y), but the gain followed two months of sharp decline. Machinery orders fell 1.3% (-8.8% y/y) after a 1.0% drop. Computer & electronic product bookings declined 0.6% (+4.8% y/y) after being roughly unchanged in August. Computer & related product orders fell 4.5% (-9.0% y/y), down hard for the third straight month. Communications equipment orders bucked these negative readings with a 2.4% gain (9.4% y/y). Electrical equipment orders also improved, but by just 0.3% (-8.5% y/y).

Shipments of durable goods gained 0.2% (0.7% y/y) following a 0.5% decline. Shipments excluding transportation eased 0.1% (-3.5% y/y), off for the third straight month. Unfilled durable goods orders fell 0.6% (-2.2% y/y) while backlogs excluding transportation declined 0.3% (-1.6% y/y), off for the eighth straight month. Decumulation of inventories continued for the fourth month in the last five. A 0.3% decline left them up, however, 1.7% y/y. Inventories excluding transportation gained 0.1% (0.3% y/y) following two months of decline.

The durable goods figures are available in Haver's USECON database. The Action Economics consensus forecast figure is in the AS1REPNA database.