Durable goods orders drop sharply
April 25, 2012
Due mostly to a sharp decline in nondefense aircraft orders, new orders for manufactured durable goods fell 4.2% in March from February to 202.6 billion, the U.S. Census Bureau reported. The increase followed a 1.9% increase February, but durable goods orders have now fallen in two of the last three months.
Excluding transportation, new durable goods orders dropped 1.1%. Defense-related orders helped the overall durable goods picture. Excluding defense, new orders fell 4.6%.
New orders for nondefense capital goods — an indicator of business investment — fell 10.5% in March to $73 billion.
In addition to future freight shipments indicated by the direction of new orders, the status of unfilled orders helps determine near-term freight volumne. Unfilled orders for manufactured durable goods increased just slightly in March, but it contined the trend with increases in 23 of the past 24 months.
On the other hand, inventories of manufactured durable goods were up for the 27th consecutive month in February, rising 0.4% to their highest level since at least 1992. Shipments of manufactured durable goods were up 1% in March following a 0.3% increase in February.
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