Durable Goods Orders Unexpectedly Drop 0.1%
New orders for durable goods fell 0.1% to $238 billion in May, according to a Commerce Department report (link opens as PDF) released today.
After orders increased an especially strong 0.8% on military aircraft orders in April, May's dip was a surprise to analysts, who had predicted an additional 0.4% boost. Durable goods are items meant to last at least three years.
May's report was firmly grounded by a 3% drop in transportation, due primarily to a drop-off in nondefense aircraft orders.
Excluding volatile transportation orders, May's numbers look slightly better. Analysts had projected 0.3% growth, while the actual number clocked in at an almost-steady -0.1%.
Still, shipments increased 0.3% for the fourth-straight improvement. Unfilled orders expanded 0.6% to notch a 13th increase in 14 months. Inventories followed a similar trend to unfilled orders, adding 1% last month. Shipments, unfilled orders, and inventories all reached record highs since data were first collected in 1992.
While this latest report isn't exactly good news, it's nothing to worry about. Recent positive economic indicators still point to steady improvement, and one month of slower aircraft orders isn't enough to derail an economy.
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