Last Update: 04-Nov-14 10:25 ET
- Durable goods orders declined 1.3% in September after declining an upwardly revised 18.3% (from -18.4%) in August. The Briefing.com consensus expected durable goods orders to increase 0.6%.
- Excluding transportation, durable goods orders declined a more modest, but still surprising, 0.2% after increasing an upwardly revised 0.7% (from 0.4%) in August. The consensus expected these orders to increase 0.5%.
- Over the past few months, large swings in aircraft orders introduced significant volatility in the durables data. It was assumed that a slight increase in orders at Boeing (BA) would drive overall orders demand higher, but that was not the case. Total aircraft orders fell 14.7% in September after declining 70.3% in August.
- All of the Federal Reserve regional manufacturing surveys pointed toward solid gains in orders demand in September. Obviously, this was one of those months where the PMI reports did not foretell trends in the hard data, which is why we are slow to believe analyses based off manufacturing surveys.
- Capital goods demand was weak. Orders of machinery fell 2.8% in September after increasing 1.1% in August. Computer and electronic parts orders reversed directions also and declined 2.5% in September after increasing 1.7% in August.
- Altogether, orders of nondefense capital goods excluding aircraft declined 1.7% in September after increasing 0.3% in August. That was the largest monthly decline since January.
- The impact on third quarter GDP growth was also negative. Shipments of capital goods declined 0.2% in September after increasing 0.1% in August.
- All-around weakness in the manufacturing sector does not bode well for future GDP growth.
|Total Durable Orders
|Nondefense/nonaircraft (core cap gds)
|Defense Cap Goods