U.S. Factory Orders Increase for the Third Straight Month in April
Summary
- Manufacturers’ new orders +0.7% (+1.3% y/y) in April; +0.7% (+1.5% y/y) in March.
- Durable goods orders (0.6%), nondurable goods orders (0.8%) and shipments (1.0%) rise for the third consecutive month.
- Unfilled orders increase 0.2% after a 0.3% March gain.
- Inventories edge up 0.1% after holding steady.
Total factory orders rose a slightly more-than-expected 0.7% m/m (1.3% y/y) in April after rises of 0.7% in March and 1.4% in February, data from the U.S. Census Bureau showed. A 0.6% m/m April increase had been expected in the Action Economics Forecast Survey. The April reading was the third consecutive m/m gain following m/m declines in January and December. Notably, orders for nondefense aircraft & parts fell 8.0% in April, reversing a 7.7% rise in March. Factory orders excluding defense grew 0.4% (2.3% y/y) in April, up for the third successive month, after a 0.9% increase in March. Factory orders excluding the transportation sector rose 0.7% (2.8% y/y), the fourth m/m rise in five months, after a 0.4% March gain.
Durable goods orders grew 0.6% (-1.0% y/y) in April, the smallest of three straight m/m gains, after a 0.8% rise in March (in line with a 0.7% m/m increase for Apr. in the advance report on May 24). The April gain reflected m/m orders rises in the following categories: 1.3% (1.4% y/y) in primary metals, 1.1% (-5.8% y/y) in transportation equipment, 0.9% (1.4% y/y) in electrical equipment, appliances & components, 0.6% (3.3% y/y) in computers & electronic products, 0.5% (0.9% y/y) in machinery, and 0.2% (2.7% y/y) in fabricated metal products. In contrast, durable goods orders for furniture & related products were the only category with a decline in April, falling 1.2% (-0.2% y/y) following two consecutive m/m increases.
Nondurable goods orders, which equal nondurable goods shipments, rose 0.8% (3.5% y/y) in April on top of a 0.7% increase in March, registering the third straight m/m gain and the fourth in five months. The April rise reflected m/m increases of 2.2% (7.7% y/y) in petroleum & coal products, 1.1% (10.5% y/y) in beverage & tobacco products, 0.7% (0.8% y/y) in printing, 0.6% (3.6% y/y) in basic chemicals, 0.5% (-0.6% y/y) in paper products, 0.2% (-1.7% y/y) in textile mills, 0.1% (2.0% y/y) in plastics & rubber products, and 0.1% (0.5% y/y) in food products. To the downside, the following nondurable goods shipments fell m/m in April: leather & allied products (-2.2%; +10.3% y/y), apparel (-0.7%; -6.6% y/y), and textile products (-0.2%; -1.2% y/y).
Total shipments rose 1.0% (2.9% y/y) in April, the third successive m/m rise, after a 0.4% increase in March. Excluding transportation, shipments rose 0.6% (2.7% y/y), the fifth m/m rise in six months, after a 0.4% March gain. Shipments of durable goods industries advanced 1.2% (2.4% y/y) in April, the largest of three straight m/m increases, after a 0.1% uptick in March. The April gain reflected m/m durable goods shipments rises in the following categories: 3.4% (4.5% y/y) in transportation equipment, 0.7% (0.2% y/y) in primary metals, 0.6% (1.6% y/y) in electrical equipment, appliances & components, 0.3% (1.6% y/y) in miscellaneous durable goods, 0.2% (2.0% y/y) in computers & electronic products, 0.2% (0.6% y/y) in machinery, 0.1% (2.9% y/y) in fabricated metal products, and 0.1% (0.8% y/y) in nonmetallic mineral products. In contrast, durable goods shipments for furniture & related products (-0.4%; -0.03% y/y) and wood products (-0.4%; +0.9% y/y) dropped m/m in April.
Unfilled orders rose 0.2% (8.1% y/y) in April after a 0.3% increase in March, continuing their string of gains since December 2022. Excluding transportation, unfilled orders dipped 0.1% (-0.9% y/y), the fourth straight m/m decline, after a 0.1% March downtick. Backlogs of durable goods also rose 0.2% (8.1% y/y) in April, reflecting rises of 0.7% (3.1% y/y) in primary metals and 0.3% (13.6% y/y) in transportation equipment.
Inventories inched up 0.1% (0.4% y/y) in April following no change in March and a 0.3% increase in February. Excluding transportation, inventories were virtually unchanged (-0.5% y/y) for the second consecutive month. Durable goods inventories ticked up 0.1% (1.3% y/y) in April, the fourth m/m rise in five months; nondurable goods inventories ticked up 0.1% (-1.1% y/y), the third successive m/m increase.
The factory sector data are available in Haver's USECON database. The Action Economics Forecast Survey is in the AS1REPNA database.
Winnie Tapasanun
AuthorMore in Author Profile »Winnie Tapasanun has been working for Haver Analytics since 2013. She has 20+ years of working in the financial services industry. As Vice President and Economic Analyst at Globicus International, Inc., a New York-based company specializing in macroeconomics and financial markets, Winnie oversaw the company’s business operations, managed financial and economic data, and wrote daily reports on macroeconomics and financial markets. Prior to working at Globicus, she was Investment Promotion Officer at the New York Office of the Thailand Board of Investment (BOI) where she wrote monthly reports on the U.S. economic outlook, wrote reports on the outlook of key U.S. industries, and assisted investors on doing business and investment in Thailand. Prior to joining the BOI, she was Adjunct Professor teaching International Political Economy/International Relations at the City College of New York. Prior to her teaching experience at the CCNY, Winnie successfully completed internships at the United Nations. Winnie holds an MA Degree from Long Island University, New York. She also did graduate studies at Columbia University in the City of New York and doctoral requirements at the Graduate Center of the City University of New York. Her areas of specialization are international political economy, macroeconomics, financial markets, political economy, international relations, and business development/business strategy. Her regional specialization includes, but not limited to, Southeast Asia and East Asia. Winnie is bilingual in English and Thai with competency in French. She loves to travel (~30 countries) to better understand each country’s unique economy, fascinating culture and people as well as the global economy as a whole.
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