Last Update: 27-Jan-15 08:54 ET
- Durable goods orders declined 3.4% in December after declining a downwardly revised 2.1% (from -0.9%) in November. The Briefing.com Consensus expected durable goods orders to increase 0.5%.
- Excluding aircraft, durable goods orders fell 0.8% in November after declining a downwardly revised 1.3% (from -0.7%) in November. The Briefing.com consensus expected these orders to increase 0.7%.
- A significant portion of the negative surprise came from seasonal adjustments in the aircraft sector. Even though Boeing (BA) reported a positive increase in orders on a month-to-month basis, sales actually declined significantly once seasonal factors were taken into consideration. Aircraft orders declined 46.4% in December, which led to a 9.2% decline in overall transportation orders.
- Unfortunately, the negative data within the durable goods report was not contained to the aircraft sector.
- The regional manufacturing surveys were mixed in December, but generally leaned to the downside. However, none of the surveys pointed toward an overall contraction in durable goods orders. The miss in the hard data, again, shows that regional surveys are not a reliable indicator for manufacturing growth.
- Orders demand fell sharply across the board, and negative revisions to November data show that the manufacturing sector is not as strong as once thought.
- Business capital demand contracted for the fourth consecutive month. Orders of nondefense capital goods excluding aircraft declined 0.6% in both December and November. Much of that decline was the result of a 3.7% decline in machinery orders and a 1.3% decline in computers and electron product orders.
- Shipments of nondefense capital goods excluding aircraft, which factor into GDP calculations, declined 0.2% in December after declining 0.6% in November.
- The stock of unfilled orders of nondefense capital goods excluding aircraft continued to grow in December. Manufacturers, however, have been very reluctant so produce off their backlog. As a result, business investment growth is being held back.
|Total Durable Orders
|Nondefense/nonaircraft (core cap gds)
|Defense Cap Goods