Global| Jan 27 2005U.S. Durable Goods Orders Up As Expected
by:Tom Moeller
|in:Economy in Brief
Summary
Durable goods orders in December rose 0.6%, right on the Consensus expectation. The advance report of a November surge in orders was little revised. For 2004, the 10.7% gain in orders was the strongest in ten years and led to a 7.1% [...]
Durable goods orders in December rose 0.6%, right on the Consensus expectation. The advance report of a November surge in orders was little revised. For 2004, the 10.7% gain in orders was the strongest in ten years and led to a 7.1% gain in factory output of durable goods.
Nondefense capital goods orders dropped 1.9%. Aircraft orders fell 16.7% following the 64.7% November spike. Excluding aircraft, orders rose 1.8% but the November gain was halved to 0.9%. For 2004 orders rose 11.5%, the strongest gain since 1997 and led to a 9.5% gain in the industrial output of business equipment, the strongest since 1998.
Orders for computers & electronic products recovered 6.4% (+15.2% y/y) following two months of sharp decline. Machinery orders also rose 3.9% (11.1% y/y) but electrical equipment orders fell 6.1% (+6.2% y/y).
Transportation equipment orders fell 3.0% but less transportation, durable goods orders rose 2.1% (11.9% y/y). Primary metals orders inched 0.3% higher (+28.5% y/y) but orders for fabricated metals fell again (+7.4% y/y).
Unfilled orders rose another 0.5% (9.0% y/y) although shipments surged 2.1% (8.8% y/y). As a result, the ratio of backlogs to shipments fell sharply to the lowest level since August.
Inventories of durable goods dipped slightly (7.4% y/y). Combined with the surge in shipments the decline lowered the I/S ratio to the lowest level since August.
| NAICS Classification | Dec | Nov | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Durable Goods Orders | 0.6% | 1.8% | 8.7% | 10.7% | 2.6% | -1.7% |
| Nondefense Capital Goods | -1.9% | 7.5% | 13.6% | 13.5% | 5.6% | -7.2% |
| Excluding Aircraft | 1.8% | 0.9% | 11.3% | 11.5% | 6.6% | -7.1% |
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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