The report on durable goods came in above expectations for the month of June. The Commerce Department’s report showed a gain of 1.6% to a seasonally adjusted $221.63 billion for the long-lasting goods. Dow Jones and Bloomberg both were calling for a gain of only 0.6%. The figure for durable goods in May was revised to +1.6% from +1.3%.
Today’s report was boosted by strong aircraft sales, both civilian and defense. If you back out transportation, the report was actually down by 1.1%. As durable goods are meant to be the big-ticket items that last three years or more, this can be a very volatile report, one that often is considerably higher or lower than the consensus targets from economists.
We have been seeing weaker than expected regional manufacturing data of late, and that has capped some of the expectations here on durables and other key economic components. This may act as a primer for Friday’s report on gross domestic product. Estimates for second-quarter GDP, which is the first look at second-quarter GDP, are put at 1.2%, according to Bloomberg. The price-weighted component is expected to come in at +1.6%, according to the Bloomberg consensus.
JON C. OGG