Durable Goods Orders
Let’s take a look inside the numbers:
- New orders for nondefense capital goods, including computers and communications hardware, rose 1.1%, the largest increase since May. (Fig 1.1). Historically this component of the report acts as a proxy for future business investment.
- Computers rose 5.5%.
- Communications hardware rose 7.8%.
- Nondefense capital goods shipped excluding aircraft, an integral component in the calculation of GDP, rose 2.8% over the month before, the largest increase since March (Fig 1.2). Machinery shipments in particular were very strong, rising 5.1%. In addition, last month’s slight decline was revised to a 0.4% rise.
- Total Inventories rose 0.9%.
- The overall 0.1% decline in durable goods orders was heavily impacted by the sensitive automobiles and parts component which declined 8.5% month on month.
Fig 1.1 U.S. Capital Goods New Orders Nondefense, April 2011 to August 2011
Fig 1.2 U.S. Capital Goods Shipped Ex-Aircraft, January 2011 to August 2011