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Economy in Brief

Durable Goods Orders Improvement Moderates
by Tom Moeller  April 27, 2017

New orders for durable goods rose 0.7% (4.5% y/y) during March following a 2.3% February gain, revised from 1.8%. A 1.2% increase in orders had been expected in the Action Economics Forecast Survey.

The increase in total orders continued to reflect strength in the transportation sector where a 2.4% increase was driven by an 11.2% jump in orders for aircraft & parts. Bookings for defense aircraft strengthened 26.1% and orders for nondefense aircraft & parts improved 7.0%. Motor vehicles & parts orders eased 0.8%. Excluding the transportation sector altogether, orders eased 0.2% following as a 0.7% gain, revised from 0.4%. The y/y increase of 4.6% was improved from a 3.5% y/y decline as of last June.

Nondefense capital goods orders increased 1.2% (9.6% y/y). Excluding the rise in aircraft, orders notched 0.2% higher. Here again, the 3.0% y/y comparison stands in contrast to a 5.6% decline as of July.

A 0.8% rise (6.0% y/y) in primary metals provided strength to overall orders gain last month, though it was counter-balanced by a 0.8% decline (+7.2% y/y) in fabricated metals orders. Electrical equipment orders gained 0.4% (4.1% y/y) after a 2.2% rise. Offsetting these increases was a 0.2% decline in machinery orders. The 5.2% y/y comparison reversed a 7.5% y/y decline as of August. Computers & electronic products orders eased 0.2% (+4.7% y/y), off for the third straight month.

Shipments of durable goods improved 0.2% for a second straight month. Orders excluding transportation ticked 0.1% higher (4.5% y/y) after a 0.7% rise. Unfilled orders of durable goods improved 0.2%, and excluding transportation they also improved 0.2% (2.6% y/y). Inventories of durable goods edged 0.1% higher. The 0.2% y/y gain stood in contrast to a 3.5% y/y rate of inventory decumulation as of last June.

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

Durable Goods NAICS Classification Mar Feb Jan Mar Y/Y 2016 2015 2014
New Orders (SA, %) 0.7 2.3 2.4 4.5 -0.4 -2.9 4.8
  Transportation 2.4 5.5 7.0 4.2 -0.5 -4.0 6.8
Total Excluding Transportation -0.2 0.7 0.3 4.6 -0.4 -2.3 3.8
  Nondefense Capital Goods 1.2 5.8 5.3 9.6 -5.2 -9.6 1.2
    Excluding Aircraft 0.2 0.1 0.2 3.0 -3.4 -3.2 0.8
Shipments 0.2 0.2 -0.0 3.7 -0.7 1.1 3.6
Unfilled Orders 0.2 0.1 -0.3 -1.0 -1.5 -2.4 8.6
Inventories 0.1 0.2 0.1 0.2 -1.1 -0.6 5.2
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