Last Update: 06-Mar-14 10:16 ET
- Durable goods orders fell 1.0% in January after declining a downwardly revised 5.3% (from -4.2%) in December. The Briefing.com consensus expected durable goods orders to fall 1.0%.
- Excluding transportation, orders increased 1.1% after falling a downwardly revised 1.9% (from -1.3%) in December. The consensus expected these orders to decline 0.2%.
- A big drop in aircraft orders (-7.2%) pulled overall transportation demand down 5.6%. Most of this decline was expected as Boeing (BA) reported a large decline in January orders. The only unknown was how large the seasonal adjustments – which were responsible for the entire 12% decline in transportation orders in December – would upwardly adjust the January transportation data.
- The strength in orders excluding transportation was a shock considering the national ISM orders index plummeted 13.2 points and barely remained above the expansion/contraction threshold.
- The gain in these orders was mostly the result of a 7.3% increase in fabricated metals demand and a 4.7% increase in computers and electronic products. Orders for machinery (-0.4%) and electrical equipment (-2.1%) both declined.
- Orders of nondefense capital goods excluding aircraft increased 1.7% in January and nearly offset the entire 1.8% December decline. The effect on GDP, however, will be limited. Shipments, which factor into GDP growth, fell 0.8% in January after increasing 0.3% in December. We are again seeing large increases in back orders in business investment goods that manufacturers are either unable or unwilling to produce.
- Sold gains in backlogs should keep overall durable goods manufacturing production strong in the face of uncertain demand.
|Total Durable Orders
|Nondefense/nonaircraft (core cap gds)
|Defense Cap Goods