U.S. factory orders remained strong in October, but the report did show a bit of slippage from the gains seen in September and August. The U.S. Department of Commerce reported on Monday that October’s factory orders of manufacturers’ shipments were down by 0.1% after a revised 1.7% gain (up from 1.4% initially reported) in September.
The poll from Reuters was calling for a worse drop at 0.4% and Dow Jones was calling for a drop of 0.3%. All in all, this means the drop was less than expected, and it can also be inferred that the higher revision from September may have negated the drop that was shown here for October.
In raw dollar terms, the Commerce Department showed that factory orders were $479.6 billion in October and $479.9 billion in September. Not all components of the report were weaker, as could be expected by the numbers being so similar.
Shipments were up in 10 of the past 11 months, and they increased $2.7 billion (0.6%) to $484.2 billion. This followed a 1.1% gain in September.
Unfilled orders, which had been down three of the past four months, decreased by $0.2 billion to $1.1351 trillion. This slight drop followed a 0.3% gain in September. The ratio of unfilled orders-to-shipments was 6.68 in October, unchanged from September.
The inventories reading had previously been up 11 of the past 12 months. This reading rose by $1.2 billion (0.2%) to $661.6 billion, after a 0.6% gain in September. And the inventories-to-shipments ratio was unchanged at 1.37 in October.
New orders for manufactured durable goods in October had been up two consecutive months and decreased by $1.9 billion (0.8 %) to $237.4 billion. Transportation equipment new orders fell by $3.4 billion (4.2%) to $77.4 billion.
This report does come with a one-month lag, versus more live readings that already have been seen elsewhere. It is unlikely that this small drop will change very much about GDP growth expectations for the fourth quarter of 2017.