New Durable Goods Orders Drop 7.3% for July
New orders for durable goods dropped 7.3% to $226.6 billion for July, according to a Commerce Department report (link opens as PDF) released today. It's the steepest drop in nearly a year.
After aircraft orders helped pushed June's new orders up a revised 3.9%, July's decrease proved much larger than expected. Overall, analysts had predicted a milder 4% slump. Durable goods are items meant to last at least three years.
Excluding volatile transportation orders (which include aircraft), July's numbers look better, but not great. Analyst expectations called for 0.3% growth, but this newest report indicates 0.6% contraction.
With new orders down, shipments also tapered off 0.3% after a 0.1% slump the previous month. While shipments are down three of the last four months, unfilled orders increased 0.4% in July for the fifth increase in six months. Both unfilled orders and inventories (up 0.4%) are at their highest levels recorded since data was first collected in 1992.
Economists tend to focus on orders for so-called core capital goods. Those orders fell 3.3%, but the drop followed four straight months of gains. Core capital goods are considered a good measure of businesses' confidence in the economy. They include items that point to expansion -- such as machinery, computers and heavy trucks -- while excluding volatile orders for aircraft and defense.
-- Material from The Associated Press was used in this report.
The article New Durable Goods Orders Drop 7.3% for July originally appeared on Fool.com.
Fool contributor Justin Loiseau has no position in any stocks mentioned. You can follow him on Twitter @TMFJLo and on Motley Fool CAPS @TMFJLo.The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.