Very much in sync with our long-running projected timeline that Goldman will downgrade the economy within a month, to be followed by some more Hatzius-Dudley tete-a-tetes in which the current head of Goldman's economic team will make it all too clear that the Great Re-Redepression is inevitable unless the former head of Goldman's economic team sacrifices another 1-2 trillion in 25% linen/75% cotton fiatscoes at the altar of the supreme bankster, Hatzius just issued his second preliminary downgrade warning for US GDP.
1. Durable goods orders disappointed expcectations with a 0.9% drop. It's a "what you see is what you get" report, as durables ex transporation and nondefense capital goods order ex aircraft likewise disappointed by a sizable margin. Indeed, the latter measure of core capital goods orders is now tracking at double-digit negative rates in the first quarter so far, although core capital goods shipments (which enter the GDP numbers) are still tracking +1% in nominal terms -- not great but not nearly as bad.
2. The data increase the sense of downside risk to our Q1 GDP estimate of 3.5%. However, it is harder to say how much they matter beyond this, as durable goods orders are notoriously noisy. Industrial production of business equipment continues to rise and the industrial surveys continue to look great, including for surveys of capex spending plans (the Philly Fed measure of this just hit an 11-year high in March). We would therefore downplay the broader message from the durable goods report.