U.S. Durable Goods Orders Rebounded in October
by:Sandy Batten
|in:Economy in Brief
Summary
- Total orders increased 0.2% m/m after declines in both August and September.
- Excluding transportation, orders rose 0.1% m/m vs. 0.4% in September.
- Core capital goods orders fell 0.2% m/m, their first decline in three months.
- Core capital goods shipments increased 0.2% m/m, their first increase in four months.
New orders for durable goods rose 0.2% m/m (+2.7% y/y) in October, the first monthly gain in three months, following a 0.4% m/m decline in September and a 0.9% m/m drop in August, according to the U.S. Census Bureau. The Action Economics Forecast Survey had expected a 0.3% m/m increase last month. Transportation equipment orders rose 0.5% m/m (+5.2% y/y) in October, their first monthly increase in three months. Orders outside the transportation sector edged up 0.1% m/m in October, their third consecutive monthly increase. Defense orders fell 2.1% m/m (+12.7% y/y), their first monthly decline since March. Orders apart from defense increased 0.4% m/m in October, their first monthly increase in three months.
The 0.5% monthly gain in transportation equipment orders reflected a 10.2% m/m increase in orders for aircraft and parts following two consecutive monthly declines and a 0.4% m/m decline in orders for motor vehicles and parts, the fourth monthly decline in the past five months. Orders for electrical equipment and appliances rose 1.3% m/m in October, more than offsetting a 0.5% monthly decline in September. Machinery orders increased 0.3% m/m in October, their first monthly increase in four months. “Other durable goods” orders increased 0.3% m/m, their third consecutive monthly gain. Orders for fabricated metal products edged up 0.1% m/m in October, their fourth consecutive monthly rise. By contrast, orders for primary metals fell 0.7% m/m after increases in both August and September. And orders for computers and electronic products edged down 0.1% m/m, their first monthly decline in three months.
Core capital goods orders (nondefense capital goods orders excluding aircraft) slipped 0.2% m/m (+0.6% y/y) in October, their first monthly decline in three months. Core capital goods shipments, a reliable coincident indicator of business spending on equipment in the national accounts, increased 0.2% m/m (-0.6% y/y), their first monthly gain in four months.
Shipments from all manufacturing industries eased 0.2% m/m (+1.5% y/y) in October, their third consecutive monthly decline. Shipments of durable goods fell 0.6% m/m (+2.2% y/y) led by a 2.1% m/m drop in transportation shipments and a 0.5% m/m decline in machinery shipments. All other durable goods sectors posted monthly increases in shipments in October. Shipments of nondurable goods edged up 0.1% m/m (+0.9% y/y) in October, their first monthly increase in three months, led by a 0.4% monthly gain in petroleum shipments.
Unfilled durable goods orders increased 0.4% m/m (+3.3% y/y) in October, their fourth consecutive monthly gain. Of the major sectors, only unfilled machinery orders posted a monthly decline. They fell 0.3% m/m and have declined in every month since January 2023.
Inventories of all manufacturing industries edged down 0.1% m/m (+0.1% y/y) in October, the second consecutive monthly decline. Durable goods inventories were essentially unchanged (+0.7% y/y) while nondurable goods inventories fell 0.1% m/m (-0.9% y/y). Inventories of capital goods fell 0.3% m/m (+2.2% y/y).
Manufacturers’ orders and shipments of durable and nondurable goods, along with unfilled orders and inventories, are compiled by the U.S. Census Bureau. They are available in Haver’s USECON database. The Action Economics forecast data are in the AS1REPNA database.
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
