Economy
Durable Goods Orders Slip 1.3% in April
Written by Sandy Williams
May 27, 2021
Durable goods orders took a surprising tumble in April, dipping 1.3% instead of rising 7-9% as predicted by economists.
The volatile transportation category was responsible for most of the decline, falling 6.7%. Automotive orders fell 2.6%, sliding for a second time in the past three months as production slowed due to supply issues with semiconductor chips. Commercial aircraft orders leapt 17.4%, after declining 26.8% last month, indicating that the industry is beginning to recover from lost orders during the pandemic. Minus transportation, durable goods orders gained 1.0% in April.
Core capital goods orders–orders excluding defense and transportation and considered an indicator for business investment–increased 2.3% following a 1.6% gain in March.
In a separate government report today, real gross domestic product (GDP) increased 6.4% in the first quarter of 2021, good news for a recovering economy.
Following is the April advance report from the U.S. Census Bureau on durable goods manufacturers’ shipments, inventories and orders:
New Orders
New orders for manufactured durable goods in April decreased $3.2 billion or 1.3% to $246.2 billion. This decrease, down following 11 consecutive monthly increases, followed a 1.3% March increase. Excluding transportation, new orders increased 1.0%. Excluding defense, new orders were virtually unchanged. Transportation equipment, down two consecutive months, drove the decrease by $4.9 billion or 6.7% to $68.9 billion.
Shipments
Shipments of manufactured durable goods in April, up 11 of the last 12 months, increased $1.4 billion or 0.6% to $248.7 billion. This followed a 2.7% March increase. Primary metals, also up 11 of the last 12 months, led the increase by $0.6 billion or 2.7% to $21.6 billion.
Unfilled Orders
Unfilled orders for manufactured durable goods in April, up three consecutive months, increased $1.9 billion or 0.2% to $1,197.0 billion. This followed a 0.5% March increase. Fabricated metal products, up 11 consecutive months, drove the increase by $3.1 billion or 3.4% to $95.9 billion.
Inventories
Inventories of manufactured durable goods in April, up three consecutive months, increased $2.2 billion or 0.5% to $441.6 billion. This followed a 1.0% March increase. Transportation equipment, also up three consecutive months, led the increase by $0.9 billion or 0.6% to $149.4 billion.
Capital Goods
Nondefense new orders for capital goods in April increased $2.7 billion or 3.5% to $80.1 billion. Shipments increased $3.1 billion or 4.1% to $78.9 billion. Unfilled orders increased $1.2 billion or 0.2% to $721.9 billion. Inventories decreased $0.3 billion or 0.2% to $196.4 billion.
Defense new orders for capital goods in April decreased $3.2 billion or 25.8% to $9.1 billion. Shipments increased $0.6 billion or 4.8% to $12.2 billion. Unfilled orders decreased $3.1 billion or 1.6% to $191.9 billion. Inventories increased $0.1 billion or 0.7% to $20.9 billion.
Revised and Recently Benchmarked March Data
Revised seasonally adjusted March figures for all manufacturing industries were: new orders, $487.8 billion (revised from $486.6 billion); shipments, $485.8 billion (revised from $485.4 billion); unfilled orders, $1,195.1 billion (revised from $1,194.2 billion) and total inventories, $721.0 billion (revised from $721.1 billion).
Sandy Williams
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Final Thoughts
We all know the American news cycle moves pretty fast. Viral today, cached tomorrow. So it is with the US presidential election on Tuesday, Nov. 5. People have election fatigue. They've moved on to other things like planning holiday parties, debating Super Bowl hopefuls, or even starting to look forward to our Tampa Steel Conference in February.