Durable Goods May Have Role in QE and Tapering Decision

We would caution that durable goods is perhaps one of the most volatile of all major economic reports. It can still move markets, and it identifies what is happening with big-ticket items. The August reading was up by 0.1% on the headline report, while Bloomberg had a consensus of -0.5% and Dow Jones had a consensus of -0.6%. Excluding transportation, the reading was -0.1%, which met the Bloomberg expectations.

July’s awful report was made even worse on the headline report, with the revised reading at -8.1% versus -7.4%. The July revision sans transportation went from -0.6% to only -0.5%.

Wednesday’s report was from the Commerce Department, and it is seasonally adjusted. If you want to know what it all means, the 0.1% gain translates to some $224.92 billion in August durable goods. Wednesday’s report was better than expected on the headline, but it is hardly worth calling a great gain by any stretch of the imagination.