Durable goods orders were up a seasonally-adjusted 6.5% in the month of June 2017. Nearly all of that gain, however, was due to a jump (131%) in new orders for civilian aircraft. That meant demand for transportation equipment, a highly volatile segment, rose 19% in the month. Excluding all that, durable goods were up just 0.2% month-over-month.
Sentiment indicators like the ISM Manufacturing PMI suggest ebullient conditions that just aren’t matched by activity levels. Halfway through 2017, that shouldn’t any longer be the case. You can understand some lingering problems especially given the nature of the downturn/manufacturing recession, but long before June those should have fully disappeared.
Unadjusted, new orders for durable goods in June 2017 were up only 6% from June 2016. According to both the adjusted as well as unadjusted figures, last June was the bottom or trough in terms of durable goods. Shipments a year later are up only 5.5%.
This post was published at Wall Street Examiner on July 27, 2017.
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