In February new orders for manufactured durable goods tumbled down by 1.7% m/m, after a 4.7% reduction in January (table 1). Moreover, excluding transportation sub index, which is the most volatile component, durable goods orders edged down by 2.6%. It came out of transportation orders, which rose by 0.6% to 62.1bln dollars. The demand for both defense and civilian aircrafts and parts increased among the components of transportation sub index. New orders for civilian aircrafts rose by 5.4%, as Boeing Company received 125 orders compared with 65 in prior month. Computers and communication equipment became another source of the growth, the orders of which were 10% and 6% more than in January. The positive impact of the above mentioned components of this macroeconomic indicator was partially offset by 13.3% and 2.7% increase of machinery and motor vehicles orders, accordingly. As a result, durable goods new orders increased by 4.2% over year.
The total volume of shipment of manufactured durable goods plunged by 2.8% m/m. The main sources of reduction were civilian aircrafts, the shipment of which rebounded by 18% and reached 9.4bln dollars. The shipment of the latter fell due to the fact that Boeing Company delivered 39 new, relatively cheap aircrafts. It decelerated the growth rate to 13.3% over year. The demand for semiconductors and computers fell significantly. However, defense aircrafts showed 25.1% gain. The shipments of machinery and primary metals also increased. Nevertheless, growth rate of manufactured durable goods shipment moderated to 4% during the last 12 months.
Unfilled orders soared by 0.8% due to their gain in both transportation equipment producing sector and manufacturing. As usual the level of this indicator has been the highest since the series was stated. Transportation constituent rose by 1.4%. This was conditioned by 2.3% increase of civilian aircrafts and parts unfilled orders, following a gain of 1.4% in January. Unfilled orders for primary metals rose by 1.6%. This index for computers and communication equipment edged up by 0.8% m/m. Only the unfilled orders for cars and machinery reduced. During the last 12 months unfilled orders for durable goods increased by 18.2%.
Inventories of durable goods demonstrated tangible positive results as the latter’s all components, excluding fabricated metal products, had uptrend dynamics. They soared by 0.5% m/m. The medium term positive dynamics of inventories is supported by aircraft building sector. In particular, aircraft and parts inventories increased fourth consecutive quarter. Due to this growth a 27.3% gain was stated over year. Only fabricated metal products inventories reduced. Durable goods inventories soared by 4.2% over year.
The growth rate of both new orders and shipment of durable goods significantly decelerated over year. As a result shipments / inventories ratio rose to 1.54, which has been the highest rate since 2001 (chart 1). However, we think that the world economic growth, the US dollar weakness and “Airbus” troubles will favor export growth. Since capital goods are the main export products for the US, it might become a significant factor for durable goods manufacturing sector’s further growth both in short and medium terms.
But within the next few years, the perspectives of durable goods industry remains “hazy” in the context of high oil prices and moderated pace of the US GDP growth.
US ECONOMIC INDICATORS
Table 1
|
Durable goods, m/m %
|
2008
|
|
2007
|
|
Feb
|
Jan
|
Dec
|
…
|
Feb
|
Jan
|
Dec
|
|
New orders
|
-1.7
|
-4.7
|
4.4
|
|
0.5
|
-6.1
|
1.5
|
|
Inventories
|
0.5
|
0.6
|
1.1
|
|
0.1
|
0.4
|
0.3
|
|
Unfilled orders
|
0.8
|
0.8
|
2.5
|
|
0.8
|
0.5
|
1.6
|
|
Shipments
|
-2.8
|
2.3
|
-0.3
|
|
-1.5
|
-1.5
|
1.6
|
Source: Census Bureau
Chart 1
Source: Census Bureau
