Factory Orders Fell In February

Factory orders fell 1.7 percent in February, more than reversing what was a strong January which, however, is revised 4 tenths lower to a gain of 1.2 percent. February weakness includes a 0.4 percent drop in non-durable orders, one that reflects weakness in petroleum and coal products, and a steep 3.0 percent decline in durable orders which are revised 2 tenths lower from the advance release of minus 2.8 percent.

The February report makes for uncomfortable reading with orders for core capital goods falling 2.5 percent and pointing to continuing trouble for business investment. Other readings include a sharp 0.7 percent fall for total shipments, a 0.3 percent fall for unfilled orders, and a 0.4 percent fall for inventories though the latter is actually a positive given the decline in shipments and keeps the inventory-to-shipments ratio at 1.37.

This year's fall in the dollar did nothing to visibly boost February's data though there are hints of relief in last week's giant surge for the ISM new orders index, one that points to a significant rebound in this report for March.

Recent History Of This Indicator:
The factory sector, as indicated by the advance durable goods report, suffered through a very soft February as demand for capital goods turned downward once again. Shipments of durable goods contracted sharply in the month and far outpaced destocking in inventories where levels look high. The factory orders report includes revised data on durable goods and initial data on non-durable goods.