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Economy in Brief

U.S. Factory Sector Orders Increase As Transportation Orders Rebound
by Tom Moeller  March 3, 2016

New orders in the manufacturing sector increased 1.6% (-3.3% y/y) during January following an unrevised 2.9% December decline. The rise compared to expectations for a 1.5% increase in the Action Economics Forecast Survey. The improvement reflected a 4.7% jump in durable goods orders (reported last week)), powered by a 54.4% surge in orders for commercial aircraft. In addition, defense aircraft orders nearly doubled m/m (26.0% y/y). Outside of the transportation altogether, factory orders eased 0.2% (-5.1% y/y). Orders for nondurable goods, which equal shipments, declined 1.4% (-6.7% y/y), dragged down by an 11.6% drop (-28.9% y/y) in the value of shipments from petroleum refineries. Apparel shipments also declined 1.7% (-3.6% y/y) but textile mill shipment were little changed (-2.7% y/y). Shipments of paper products edged 0.2% higher (-1.8% y/y). Shipments of durable goods increased 2.0% as transportation equipment shipments jumped 5.6% (3.2% y/y). The value of shipments overall, less the transportation sector eased 0.7% (-5.2% y/y).

Unfilled orders in the factory sector improved 0.1% (-1.7% y/y) following a 0.5% drop. Outside of the transportation sector, unfilled orders increased 0.2%, but still were down 2.0% y/y. Backlogs of durable goods improved 0.1% (-1.7% y/y) and unfilled orders for transportation equipment remained unchanged (-1.5% y/y).

Manufacturing sector inventories fell 0.4% (-1.9% y/y), the seventh consecutive month of decline. Inventories excluding transportation were off 0.7% (-3.0% y/y). Machinery inventories declined 0.4% (-1.3% y/y) and electrical products inventories fell 0.4% (-2.7% y/y). Nondurable goods inventories were off 0.9% (-3.3% y/y) as petroleum inventories declined 6.7% (-23.1% y/y). Chemical inventories fell 0.4% (-1.4% y/y) while food product inventories remained unchanged (-0.1% y/y).

The factory sector figures are available in Haver's USECON database. The expectations figure from the Action Economics Forecast Survey is available in AS1REPNA.

Factory Sector- NAICS Classification (%) Jan Dec Nov Y/Y 2015 2014 2013
New Orders 1.6 -2.9 -0.7 -3.3 -6.6 3.5 2.0
Shipments 0.3 -1.4 -0.1 -4.0 -4.3 2.6 1.9
Unfilled Orders 0.1 -0.5 0.1 -1.7 -1.9 11.5 6.5
Inventories -0.4 -0.2 -0.3 -1.9 -1.9 2.4 1.7
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