28 February 2012 14:35 [Source: ICIS news]
WASHINGTON (ICIS)--US orders for manufactured durable goods fell by 4% in January from December, the Commerce Department said on Tuesday, marking a reversal to what had been three consecutive months of gains.
Durable goods are manufactured products meant to last three years or more and include items such as automobiles, appliances, transportation and manufacturing equipment.
Many durable goods, such as computers and automobiles, are major downstream markets for chemicals, resins and derivatives used in manufacturing processes or as end-product components.
Much of the decline in durable goods orders in January was attributed to a 6.1% decline in orders for transportation-related items, such as civilian airliners, military equipment and automobiles.
In turn, the bulk of the fall-off in transportation equipment business was driven by a decline in orders for civilian aircraft and parts.
Orders for transportation equipment often vary widely month to month, so economists look to durable goods orders minus transportation to get a more balanced indication of manufacturing growth.
However, even with transportation figures backed out of the January data, durable goods orders still showed a 3.2% decline.
In addition, with defence-related items subtracted from the whole, durable goods orders decreased by 4.5% in January, the report said.
The report also said that unfilled orders for durable goods increased in January by $4.8bn or 0.5% to $917.1bn. However, that rate of advance was lower than the 1.5% gain seen in December.
Nevertheless, unfilled orders for durable goods have been increasing for 21 out of the past 22 months.
Inventories of produced but unsold durable goods also gained in January from December, increasing by $2.6bn or 0.7% to $372.5bn, the highest level since the current data set was initiated in 1992.
This category has shown advances for 25 consecutive months.
US durable goods orders and inventories*
Jan (bn $)
Jan vs Dec (%)
Dec vs Nov (r) (%)
($1 = €0.75)
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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