A veritable blizzard of economic data is set for release Wednesday, just in time to give everyone something to chew over before the Thanksgiving holiday. First out are the advance report on durable goods orders and the weekly report on new claims for unemployment benefits.
New orders for manufactured durable goods fell 2% in October to $230.3 billion. In September orders grew by 4%. Economists were expecting an October increase of 0.4%, excluding transportation. The month-over-month change came in as expected.
Orders for non-defense capital goods fell 3.9% and inventories rose by 0.6%. New orders for defense goods fell 16.3%. Transportation equipment orders fell 5.9%, with the largest drop occurring in non-defense aircraft and parts, which accounted for $3 billion of the $4.6 billion decrease.
On the jobs front, new claims for unemployment benefits fell by 10,000 from the prior week’s revised total of 326,000 to 316,000 for the week ending November 23. The four-week moving average was down 7,500 to 331,750. The consensus estimate called for a drop of 18,000.
The army of the unemployed rose to a total of 3.913 million week-over-week. In the same week last year, the total number of unemployed was 5.183 million.
The government shutdown in October probably deserves the credit (or blame) for the slowdown in durable goods orders and the smaller than estimated drop in jobless claims. Recall that October jobless claims were skewed by furloughed federal employees applying for unemployment benefits and the foul-up in reporting from California.
Claims for unemployment benefits are generally falling, but the decline is very slow. Next Friday the Census Bureau will release its report on nonfarm payrolls for November and its “official” unemployment rate. The current projection for the unemployment rate is 7.2%, up from 7.1% in October.