Data on core capital goods orders are uninspiring, unchanged for new orders in March to extend a soft trend. Shipments for this series, which are inputs into GDP, inched 0.3 percent higher but follow outright declines in the first two months of the quarter.
Shipments in March fell 0.5 percent and unfilled orders fell 0.1 percent. Manufacturers are carefully watching inventories for unwanted builds keeping inventories flat in the month and the inventory-to-shipments ratio unchanged at 1.66.
The benefits of the lower dollar and higher energy prices have yet to give the factory sector much lift, at least they didn't in March though there are hints in anecdotal reports of emerging strength in April.
Recent History Of This Indicator:
The dollar may be depreciating and oil prices may be stabilizing, but they have done very little - at least so far - to hold up durable goods orders which fell a steep 2.8 percent in February including a very weak 1.0 percent decline when excluding transportation equipment (and related month-to-month volatility in aircraft orders). Forecasters do see a bounce for March, at plus 1.6 percent for the main headline and at plus 0.5 percent for ex-transportation orders. Readings for core capital goods orders, including both orders and shipments, proved very weak in February and a lack of rebound in March would point to further erosion in business investment and continued weakness in productivity growth. Still, strength tied to the decline in the dollar, which will help exports, and to higher oil prices, which will boost energy equipment, appear certain to give a lift to the factory sector, sooner than later.
The dollar may be depreciating and oil prices may be stabilizing, but they have done very little - at least so far - to hold up durable goods orders which fell a steep 2.8 percent in February including a very weak 1.0 percent decline when excluding transportation equipment (and related month-to-month volatility in aircraft orders). Forecasters do see a bounce for March, at plus 1.6 percent for the main headline and at plus 0.5 percent for ex-transportation orders. Readings for core capital goods orders, including both orders and shipments, proved very weak in February and a lack of rebound in March would point to further erosion in business investment and continued weakness in productivity growth. Still, strength tied to the decline in the dollar, which will help exports, and to higher oil prices, which will boost energy equipment, appear certain to give a lift to the factory sector, sooner than later.
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