Economy

Durable Goods Proved to Be Quite Durable in July

The U.S. Department of Commerce has reported that durable goods orders were rather durable in July. New orders rose by 2.0%, much better than the -0.4% expected by Bloomberg and better than the 0.1% gain expected by the Wall Street Journal and Dow Jones. Also, the June report was revised to a gain of 4.1% from a preliminary report of a gain of 3.4%.

In terms of real world dollars, that 2% gain was up $4.6 billion to $241.1 billion. Transportation equipment was up for the second straight month, up $3.8 billion to $83.2 billion in July.

Unfilled orders for manufactured durable goods in July rose by $2.3 billion (or 0.2%) to $1.1975 trillion. This followed a virtually unchanged June increase.

Excluding transportation, the gain was a more moderate 0.6% in July. Bloomberg had that consensus estimate at 0.4%, and the June report was revised up to 1.0% from a preliminary report of 0.8%.

There is also a core durable goods reading that is measured by new orders for non-defense capital goods, excluding aircraft. This rose for the second straight month, up to 2.2% in July, and that appears to be the biggest single month gain for just over a year.

Inventories of manufactured durable goods in July fell by $0.1 billion to $402.1 billion. Primary metals, down six consecutive months, drove the decrease with a drop of $0.2 billion (-0.5%) to $37.1 billion.

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