March Factory Orders Ticked Higher

The U.S. Department of Commerce reported that factory orders rose by 1.1% in the month of March. This has a one-month lag, so it may not show up in any other numbers until future revisions for first-quarter gross domestic product (GDP). Bloomberg was calling for a gain of only 0.6%.

A revision was seen for February as well, with the −1.7% (contraction) being revised to a wider −1.9% level.

Wednesday’s report from the Commerce Department showed that the new orders for manufactured durable goods rose by $1.8 billion, or up 0.8%, to $230.7 billion in March. This increase marked gains for two of the prior three months but followed a drop of 3.1% in February.

Excluding transportation, these new orders decreased by 0.2%. Excluding defense, new orders decreased by a total of 1.0%.
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Transportation equipment has now been up two of the past three months. This increase was by $2.2 billion, or up by 2.9%, to $76.0 billion in March.

Other key factors were reported as follows for March:

• Shipments decreased by $1.1 billion, or 0.5%, to $237.0 billion.
• Unfilled orders fell by $1.3 billion, or 0.1%, to $1,182.5 billion.
• Inventories increased less than $0.1 billion, virtually unchanged, to $394.1 billion.
• Nondefense new orders for capital goods dropped by $0.8 billion, or 1.1%, to $71.6 billion.

Data used for the factory orders are based on a panel of approximately 4,800 reporting units, representing approximately 3,000 companies. To be more specific, the Commerce Department says this report represents roughly 61% of the total value of shipments for manufacturing establishments in the 2012 Economic Census and includes almost two-thirds of the manufacturing companies with $500 million or more in shipments in the 2012 Economic Census.