A big swing higher for civilian aircraft skews August's durable goods
headline which jumped 4.5 percent to hit Econoday's high estimate. But
when excluding aircraft and other transportation equipment, durable
goods orders inched only 0.1 percent higher which falls below Econoday's
low estimate. And far below the low estimate are core capital goods
orders (nondefense ex-aircraft) which fell 0.5 percent.
Orders
for civilian aircraft surged 108 percent in the month but follow a 41
percent drop in July. Other categories of note include motor vehicles,
down 1.0 percent, machinery up only 0.1 percent, computers &
electronics down 0.5 percent, and fabricated metals which were
unchanged. Gainers include primary metals at 0.9 percent and also
communications equipment at 0.7 percent.
The drop for core
capital goods does follow strong gains in prior months, including 1.5
percent in July, and though the drop points to a slip for related
shipments, core capital goods shipments did rise 0.3 percent in August
which will help the nonresidential fixed investment reading for
third-quarter GDP.
And a major plus overall is an unusual 0.9
percent jump in total unfilled orders. Inventories drew down sharply in
August, 0.4 percent lower but follow a 1.2 percent build in July and,
for third-quarter GDP, will be offset by strong builds for wholesale and
retail inventories where advance data were also released this morning.
This
is a widely mixed report but underlying it is general strength for
manufacturing, a sector that is still getting a boost from capital goods
and which the economy is depending on for year-end strength.
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