Factory Orders Fall in January Following 5 Months of Growth
The Commerce Department's final report on January factory orders and shipments posted its first drop in six months. Automobiles and commercial jets both posted decreases.
The U.S. Department of Commerce reported Tuesday morning that factory orders slipped by 1.4% ($6.9 billion) in January to $491.7 billion. Bloomberg had its Econoday consensus estimate at a −1.2%. The December drop of 1.8% was revised down by 0.1 percentage point.
January’s decline marks the first after five straight months of increases. Shipments rose 0.6% ($2.8 billion) to $498.8 billion. Unfilled orders fell by 0.3% ($2.9 billion) to $1.14 trillion after four straight months of increases.
Inventories that had been up in 14 of the past 15 months rose in January by $2.1 billion, or 0.3%, to $672.4 billion. Inventories increased by 0.7% in December. The inventories-to-shipments ratio was 1.35, flat with December.
Transportation equipment, up two of the past three months, led the increase in shipments, rising $0.6 billion, or 0.7%, to $81.5 billion. Automobile shipments fell by 1.2% month over month on a seasonally adjusted basis and are down 5.2% year over year non-seasonally adjusted.
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Sales of non-defense aircraft and parts rose 0.6% month over month but are down 0.9% year over year. Sales of defense aircraft and parts dipped 0.1% month over month and are up 19% year over year.
Farm machinery sales were flat month over month and up 19.1% year over year. Construction machinery sales dipped 0.4% month over month and are up 19.8% year over year.
Turbines, generators and other electrical power transmission products posted a month-over-month drop in shipments of 3.1% but a year-over-year increase of 14.8%.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
