In one of the biggest economic misses that I can recall, the Econoday durable goods consensus was overly optimistic by a whopping 3.9 percentage points after factoring in negative revisions.
Econoday Durable Goods Forecast
Advance Report Details
Let's dive into the Census Advance Durable Goods Report for more details.
- New orders for manufactured durable goods in November decreased $5.0 billion or 2.0 percent to $242.6 billion, the U.S. Census Bureau announced today. This decrease, down two of the last three months, followed a 0.2 percent October increase.
- Excluding transportation, new orders were virtually unchanged.
- Excluding defense, new orders increased 0.8 percent. Transportation equipment, also down two of the last three months, led the decrease, $4.9 billion or 5.9 percent to $79.2 billion.
- Shipments of manufactured durable goods in November, up following four consecutive monthly decreases, increased $0.2 billion or 0.1 percent to $251.6 billion.
- This followed a 0.1 percent October decrease. Fabricated metal products, up three of the last four months, drove the increase, $0.3 billion or 1.0 percent to $34.1 billion.
- Unfilled orders for manufactured durable goods in November, down two of the last three months, decreased $4.7 billion or 0.4 percent to $1,159.0 billion. This followed a virtually unchanged October increase.
- Transportation equipment, down following four consecutive monthly increases, led the decrease, $4.6 billion or 0.6 percent to $790.3 billion.
- Inventories of manufactured durable goods in November, up sixteen of the last seventeen months, increased $1.8 billion or 0.4 percent to $434.0 billion. This followed a 0.4 percent October increase.
- Transportation equipment, also up sixteen of the last seventeen months, drove the increase, $1.8 billion or 1.2 percent to $149.3 billion.
- Nondefense new orders for capital goods in November decreased $1.3 billion or 1.8 percent to $71.3 billion.
- Shipments decreased $0.7 billion or 0.9 percent to $74.4 billion. Unfilled orders decreased $3.1 billion or 0.5 percent to $684.3 billion. Inventories increased $1.1 billion or 0.6 percent to $196.8 billion.
- Defense new orders for capital goods in November decreased $5.5 billion or 35.6 percent to $10.0 billion.
- Shipments decreased $0.1 billion or 0.5 percent to $12.8 billion. Unfilled orders decreased $2.7 billion or 1.7 percent to $158.2 billion. Inventories increased less than $0.1 billion or 0.2 percent to $24.3 billion.
Shockingly Bad Report
This was a shockingly bad report in the face of the GM strike that ended on October 25.
Economists expected a huge jump in orders that instead went hugely in reverse.
Yet, inventories are up 16 out of the last 17 months.
This forecast miss is on top of a large miss in new home sales estimates. For details, please see New Home Sales Badly Miss Expectations.
Mike "Mish" Shedlock