Economy
Durable Goods Orders Slow in August
Written by Sandy Williams
September 25, 2020
Orders for durable goods rose for the fourth consecutive month in August but at a much slower pace than July, said the Department of Commerce.
New orders for manufactured goods expected to last at least three years increased 0.4 percent to $232.8 billion in August, a sharp deceleration from the 11.7 percent surge in July. The August gain fell short of economist expectations of a 1.5 percent to 1.8 percent increase for the month.
Orders for core capital goods, non-defense orders minus aircraft that are considered a proxy for future business spending, rose 1.8 percent in August compared to a 2.5 percent gain in July (revised from 1.9 percent).
“The rise in core orders suggests that while slowing, the recovery in capex is not screeching to a halt and starting from a better place,” said analysts at Wells Fargo.
Durable goods shipments slipped 0.3 percent after three months of increases, led by a 1.7 percent decline for of transportation equipment
The U.S. Census Bureau August advance report on durable goods manufacturers’ shipments, inventories and orders follows:
New Orders
New orders for manufactured durable goods in August increased $1.0 billion or 0.4 percent to $232.8 billion, the U.S. Census Bureau announced today. This increase, up four consecutive months, followed an 11.7 percent July increase. Excluding transportation, new orders increased 0.4 percent. Excluding defense, new orders increased 0.7 percent. Machinery, also up four consecutive months, led the increase, $0.5 billion or 1.5 percent to $31.2 billion.
Shipments
Shipments of manufactured durable goods in August, down following three consecutive monthly increases, decreased $0.7 billion or 0.3 percent to $244.1 billion. This followed a 7.6 percent July increase. Transportation equipment, also down following three consecutive monthly increases, drove the decrease, $1.4 billion or 1.7 percent to $81.6 billion.
Unfilled Orders
Unfilled orders for manufactured durable goods in August, down five of the last six months, decreased $6.3 billion or 0.6 percent to $1,078.4 billion. This followed a 0.7 percent July decrease. Transportation equipment, down six consecutive months, drove the decrease, $6.9 billion or 0.9 percent to $728.0 billion.
Inventories
Inventories of manufactured durable goods in August, down three consecutive months, decreased $0.5 billion or 0.1 percent to $420.5 billion. This followed a 0.8 percent July decrease. Machinery, down seven of the last eight months, led the decrease, $0.4 billion or 0.6 percent to $69.1 billion.
Capital Goods
Nondefense new orders for capital goods in August increased $4.6 billion or 7.8 percent to $62.9 billion. Shipments increased $2.2 billion or 3.3 percent to $70.1 billion. Unfilled orders decreased $7.1 billion or 1.2 percent to $593.7 billion. Inventories increased $0.1 billion or 0.1 percent to $193.0 billion. Defense new orders for capital goods in August decreased $0.5 billion or 3.3 percent to $13.7 billion. Shipments decreased less than $0.1 billion or 0.4 percent to $12.2 billion. Unfilled orders increased $1.5 billion or 0.8 percent to $181.6 billion. Inventories increased $0.1 billion or 0.5 percent to $21.2 billion.
Revised July Data
Revised seasonally adjusted July figures for all manufacturing industries were: new orders, $466.7 billion (revised from $466.1 billion); shipments, $479.7 billion (revised from $479.5 billion); unfilled orders, $1,084.8 billion (revised from $1,084.3 billion) and total inventories, $686.4 billion (revised from $687.2 billion).
Sandy Williams
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