Factory Orders Join Parade Of Economic Misses; Inventories Of Manufactured Durable Goods At Highest Ever

Tyler Durden's picture

And another miss. Factory orders dropped 1.2% in April, down two of the last three months, to $40.4 billion, following a material March revision from 3.0% to 3.8%. The drop was greater than expected, missing consensus of -1.0%, and indicative that the transition from Q1 GDP strength to Q2 GDP weakness is, as expected, going to be acute. Elsewhere, inventories of manufactured durable goods in April, up sixteen consecutive months, increased $3.3 billion or 0.9 percent to $350.6 billion, unchanged from the previously published increase. This was at the highest level  since the series was first published on a NAICS basis and followed a 1.7 percent March increase. Look for inventories to be the swing factor once again in Q2 GDP. Inventories rose 1.3% in April, shipments down 0.2% higher, and unfilled orders were up 0.3%. The inventory-to-shipments ratio was up to 1.32 in April from 1.30 in March.

More from the report:

New Orders

New orders for manufactured durable goods in April, down two of the last three months, decreased $7.1 billion or 3.6 percent to $190.3 billion, unchanged from the previously published decrease. This followed a 4.6 percent March increase.

Transportation equipment, also down two of the last three months, had the largest decrease, $4.8 billion or 9.3 percent to $46.9 billion.
New orders for manufactured nondurable goods increased $1.6 billion or 0.6 percent to $250.1 billion.

Shipments

Shipments of manufactured durable goods in April, down following four consecutive monthly increases, decreased $2.5 billion or 1.3 percent to $194.4 billion, revised from the previously published 1.0 percent decrease. This followed a 3.1 percent March increase.

Transportation equipment, also down following four consecutive monthly increases, had the largest decrease, $1.6 billion or 3.3 percent to $46.5 billion.

Shipments of manufactured nondurable goods, up ten consecutive months, increased $1.6 billion or 0.6 percent to $250.1 billion. This followed a 3.1 percent March increase. Food products, up eight consecutive months, led the increase, up $1.1 billion or 1.8 percent to $61.0 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.9 percent March increase.

Unfilled Orders

Unfilled orders for manufactured durable goods in April, up twelve of the last thirteen months, increased $2.5 billion or 0.3 percent to $850.7  billion, revised from the previously published 0.2 percent increase. This followed a 0.7 percent March increase. Machinery, up fifteen consecutive months, had the largest increase, $2.5 billion or 2.5 percent to $104.0 billion.

Inventories

Inventories of manufactured durable goods in April, up sixteen consecutive months, increased $3.3 billion or 0.9 percent to $350.6 billion, unchanged from the previously published increase. This was at the highest level since the series was first published on a NAICS basis and followed a 1.7 percent March increase.

Transportation equipment, also up sixteen consecutive months, had the largest increase, $0.9 billion or 0.9 percent to $106.0 billion.
Inventories of manufactured nondurable goods, up eight consecutive months, increased $4.4 billion or 1.9 percent to $237.2 billion. This followed a 1.0 percent March increase. Petroleum and coal products, also up eight consecutive months, led the increase, up $3.2 billion or 6.0 percent to $55.7 billion.

By stage of fabrication, April materials and supplies increased 0.9 percent in durable goods and 0.5 percent in nondurable goods. Work in  process increased 1.1 percent in durable goods and 3.5 percent in nondurable goods. Finished goods increased 0.7 percent in durable goods and 2.2 percent in nondurable goods.