Durable Goods Orders Rise After Revised Dip in May

Durable goods orders increased 0.7 percent after dropping 1.0 percent in May, according to data released by the US. Census Bureau. New orders, excluding transportation, increased 0.8 percent. Excluding defense, new orders increased 0.7 percent. Machinery led the advance in June with a 2.4 percent increase in new orders.

“Durable goods orders climbed 0.7% in June, but the gain falters to just 0.1% when volatile civilian aircraft and defense orders are removed,” wrote analysts at IHS. “The Census Bureau data on durable goods say manufacturing is mediocre, while the industrial production and manufacturing surveys say orders and production are great. The latter two fit the story more consistently. The manufacturing sector is benefitting from a pickup in inventory building after a period of inventory restraint, and that is producing a boomlet in manufacturing for the near term. The business surveys, industrial production, inventory swings, and manufacturing employment data all tell a story of above-normal growth, but the durable goods report says ‘nay.’ We believe the more consistent story of the majority of reports.”