2018 Economic Calendar
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Durable Goods Orders  
Released On 7/26/2018 8:30:00 AM For Jun, 2018
PriorPrior RevisedConsensusConsensus RangeActual
New Orders - M/M change-0.6 %-0.3 %3.2 %1.1 % to 5.0 %1.0 %
Ex-transportation - M/M-0.3 %0.3 %0.5 %0.0 % to 0.8 %0.4 %
Core capital goods - M/M change-0.2 %0.7 %0.5 %0.3 % to 0.5 %0.6 %

Helping to give a 1.0 percent boost to durable goods orders, aircraft orders did in fact rise sharply in June but still not nearly as much as expected given Econoday's consensus for a 3.2 percent surge. Civilian aircraft orders rose 15.7 percent in the month but follow sharp declines of 21.0 percent and 39.4 percent in the prior two months. Excluding transportation, durable goods orders managed a moderate 0.4 percent rise to just miss expectations for 0.5 percent.

Strength in the report is centered in core capital goods (nondefense ex-aircraft) where orders rose 0.6 percent to just exceed Econoday's consensus. Shipments for this reading, which are inputs into GDP, rose a sharp 1.0 percent which should raise estimates for second-quarter nonresidential investment.

Orders for primary metals fell 0.4 percent following May's 0.1 percent dip, with fabrications, which are indirectly affected by tariffs, up only 0.1 percent in June after a 1.2 percent May decline. These two components make up more than 20 percent of total durable orders. In contrast to the soft new order data, inventories and unfilled orders for both primary metals and fabrications are building sharply.

Total unfilled orders, which have been building in recent months, rose a useful 0.4 percent in June which is another positive for the factory employment outlook. Total shipments surged 1.7 percent while inventories, which were already lean, slipped 0.1 percent. This mismatch drives the inventory-to-shipments ratio down sharply, to 1.60 vs 1.63 in both May and April.

Though aircraft is soft, this is otherwise a very positive report showing solid strength for capital goods. Manufacturing remains one of this year's top performing sectors.

Consensus Outlook
A pent-up surge in aircraft orders is expected to make for a big bounce higher in durable goods orders where the consensus for June is a 3.2 percent gain vs May's 0.6 percent decline. Strength elsewhere is expected to be less exaggerated but still solid with both ex-transportation and core capital goods at a 0.5 percent consensus. May's data included slowing in orders for steel and aluminum which spiked in March and April following the imposition of import tariffs.

Durable goods orders are new orders placed with domestic manufacturers for factory hard goods. The report also contains information on shipments, unfilled orders and inventories. The advance release provides early estimates and is revised about a week later by the factory orders report.  Why Investors Care
Monthly fluctuations in durable goods orders are frequent and large and skew the underlying trend in the data. In fact, even the yearly change must be viewed carefully because of the volatility in this series.
Data Source: Haver Analytics

2018 Release Schedule
Released On: 1/262/273/234/265/256/277/268/249/2710/2511/2112/21
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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