Durable Goods Orders Tumbled in October

November 22, 2017 by Paul Ausick

The U.S. Department of Commerce reported on Wednesday that October’s reading on durable goods contracted by 1.2% to $236 billion month over month. The consensus estimate from Bloomberg called for a rise of 0.4% following an increase of 2.2% in September.

Orders for durable goods excluding transportation were up by 0.4%, lower than Bloomberg’s consensus estimate for a 0.5% gain. September’s reading was revised up to a gain of 1.1% from an uptick of 0.7% reported on a preliminary basis.

Excluding orders for defense goods, new orders dropped 0.8%.

There is a core capital goods reading that came in with a month-over-month decline of 0.5%, well below the consensus estimate for a gain of 0.5%. Year over year, the core reading rose 8.1%, below the revised September year-to-date gain of 8.7%.

There were some positive readings inside the October report. There was a 0.7% month-over-month gain in computer and electronic product orders. Defense aircraft parts posted a 5.5% gain to $4.23 billion.

Inventories of manufactured durable goods rose 0.1% to $404.1 billion in October, and that is now up in 15 of the past 16 months. There had been a 0.6% gain in September. Primary metals led the inventory increase with a 0.4% gain to $33.9 billion.

Nondefense new orders for capital goods decreased by $3.4 billion (down 4.5%) to $72.3 billion in October. Shipments decreased by $1.4 billion (1.9%) to $72.37 billion and unfilled orders were unchanged at  $705.23 billion.

Each monthly durable goods report is subject to revision, and there are times that those revisions can be significant. Each of these Commerce Department reports are based on a panel of approximately 5,000 reporting units that represent approximately 3,100 companies from the manufacturing sector.

Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE

Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply
clicking here
you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.


Click here
to match with up to 3 financial pros who would be excited to help you make financial decisions.