U.S. Factory Orders Rise for the Second Straight Month in April
Summary
- April new orders (+0.4%) and durable goods orders (+1.1%) both up for the second consecutive month, while nondurable goods orders (-0.1%) and shipments (-0.4%) post their fifth m/m decline in six months.
- Unfilled orders grow 0.8%, the fourth m/m increase in five months and the biggest since Jan. ’22.
- Inventories rebound 0.5%, the first m/m rise since January.
Total factory orders increased 0.4% m/m (0.2% y/y) in April after a 0.6% gain in March (+0.9% originally) and a 1.7% drop in February, according to the U.S. Census Bureau. A 0.8% m/m April increase had been expected in the Action Economics Forecast Survey. The April m/m rise was the second successive monthly gain and the third in five months. Factory orders excluding the transportation sector fell 0.2% (-2.2% y/y), the fifth m/m fall in six months, on top of a 1.0% March decline.
Durable goods orders rose 1.1% (4.2% y/y) in April after a 3.3% increase in March (+1.1% for Apr. unrevised from the advance report on May 26). The April rise reflected m/m orders increases of 3.7% (13.8% y/y) in transportation equipment, 1.0% (1.1% y/y) in machinery, and 0.1% (1.8% y/y) in furniture & related products. To the downside, orders for electrical equipment, appliances & components (-1.7%; +3.6% y/y), computers & electronic products (-1.4%; +1.8% y/y), and primary metals (-0.6%; -3.3% y/y) posted their m/m decreases in April. Orders for fabricated metal products were virtually unchanged m/m (-2.1% y/y) following two straight monthly increases.
Nondurable goods orders, which equal nondurable goods shipments, dipped 0.1% (-3.3% y/y) in April, the fifth monthly decline in six months, after a 1.8% decrease in March. The April easing reflected m/m declines of 0.7% (-3.9% y/y) in textile products, 0.7% (-3.6% y/y) in plastics & rubber products, 0.5% (+1.1% y/y) in paper products, 0.4% (-7.7% y/y) in textile mills, 0.4% (-0.4% y/y) in food products, 0.4% (+1.5% y/y) in basic chemicals, 0.4% (+4.7% y/y) in leather & allied products, and 0.1% (+2.5% y/y) in printing. To the upside, nondurable goods shipments for the following groups registered m/m increases in April: apparel (5.5%; 2.7% y/y), petroleum & coal products (0.6%; -15.7% y/y), and beverage & tobacco products (0.4%; 13.3% y/y).
Total shipments slid 0.4% (-0.5% y/y) in April, the fifth m/m slide in six months, on top of a 0.6% decline in March (-0.1% originally). Excluding transportation, shipments fell 0.2% (-1.7% y/y), down for the fifth time in six months, after a 1.1% March drop. Shipments of durable goods industries fell 0.7% (+2.8% y/y), the second m/m fall in three months, reversing a 0.7% March increase. The April fall reflected m/m shipments drops of 1.8% (+7.0% y/y) in transportation equipment, 1.5% (+8.0% y/y) in electrical equipment, appliances & components, 1.3% (-4.6% y/y) in wood products, 1.0% (+0.2% y/y) in furniture & related products, 0.5% (-2.7% y/y) in primary metals, 0.4% (+1.0% y/y) in miscellaneous durable goods, 0.3% (-0.8% y/y) in fabricated metal products, and 0.2% (+2.1% y/y) in computers & electronic products. In contrast, shipments for machinery (0.9%; 4.0% y/y) and nonmetallic mineral products (0.3%; 1.0% y/y) posted their monthly gains in April.
Unfilled orders rose 0.8% (5.2% y/y) in April, the fourth m/m rise in five months and the largest since January 2022, after a 0.4% rebound in March. Excluding transportation, unfilled orders were essentially unchanged m/m (0.3% y/y) after a 0.1% March uptick. Backlogs of durable goods also rose 0.8% (5.2% y/y), reflecting rises of 1.3% (8.5% y/y) in transportation equipment, 0.3% (4.2% y/y) in electrical equipment, appliances & components, and 0.2% (-5.9% y/y) in furniture & related products.
Inventories grew 0.5% (2.1% y/y) in April, the first m/m increase in three months, following a 0.8% decrease in March. Excluding transportation, inventories dipped 0.1% (+2.3% y/y), the third consecutive m/m easing, following a 0.3% March decline. Durable goods inventories rebounded 1.0% (2.6% y/y) in April, the fourth m/m increase in five months, while nondurable goods inventories fell 0.3% (+1.2% y/y), the fifth m/m fall in six months.
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.
