US September durable goods orders +3.7% vs +2.3% expected
This report was delayed due to the shutdown.
- Prior reading was +0.1% (revised to +0.2%)
- Capital goods orders non-defense excluding aircraft -1.1% vs +1.0% expected
- Prior Capital goods orders non-defense excluding aircraft revised to -0.4% vs -0.1%
- Capital goods shipments non-defense excluding aircraft -0.2% vs +1.1% expected
- Ex-transport -0.1% vs +0.5% expected
This is much worse than the overall headline suggests. The unexpected drop in ‘core’ orders points to a weak year-end and shows the even before the shutdown, the economy was struggling. The sole reason for the jump in the headline was a 57.5% rise in nondefense aircraft orders from 127 orders at Boeing compared to 16 in August.
The theory at the start of the quarter when there was a 3.5% drop was that it was a usual thing and was paid back at quarter-end. That wasn’t the case.
Core capital goods orders with 4-month moving avg
The chart shows a troubling trend in orders with the average over the past four months at -0.8%. This is one of the best leading indicators of the US economy and it soured even before Congress sabotaged the economy.
