US durable goods continued to slide in April

28 May 2008 14:29  [Source: ICIS news]

WASHINGTON (ICIS news)--New orders for US durable goods fell by $1bn (€640m) or 0.5% in April from March to $214.4bn, the Commerce Department said on Wednesday, with a sharp drop in transportation equipment driving the ongoing decline.

 

Although modest, the April decline in durable goods orders marked the third decrease in four months and followed a 0.3% fall in March.

 

Durable goods are manufactured products meant to last three years or more and include such items as automobiles, appliances, transportation and manufacturing equipment.  Many durable goods, such as computers and automobiles, are major downstream markets for chemicals and chemicals-based products and components.

 

The department said that April’s decline was due chiefly to a whopping 8% fall in new orders for transportation equipment, and that if that data were backed out of the total, new orders for durable goods would show an increase of 2.5%.

 

Within transportation, the April decline was attributed chiefly to a drop in new orders for commercial aircraft and parts.  Aircraft orders often are made in multiple-plane purchases and in any given month can affect manufacturing data disproportionately in either direction.

 

In contrast to the continuing slide in new orders, shipments of manufactured durable goods rose $2.5bn or 1.2% in April to $212.2bn, reversing the 0.9% decline seen in March and marking the first upturn in three months.

 

Unfilled orders also rose in April by $7.6bn or 1% to $804.5bn.  This was the highest level since the data series was initiated in 1992 and marked the 26th increase in the last 27 months, the department said.

 

Inventories of manufactured durable goods were up by $1.7bn or 0.5% in April to $328.6bn, the department said.  This figure also marked the highest level since the series began in 1992, and the April gain was the ninth increase in the last 10 months.

US durable goods orders and inventories*

	Apr           (bn $)	Apr vs Mar          (%)	Mar vs Feb (r)              (%)
New orders	214.4	-0.5	-0.3
Unfilled orders	804.5	1	1.3
Total inventories	328.6	0.5	1.0

r: revised  *seasonally adjusted

($1 = €0.64)

 

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By: Joe Kamalick
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