U.S. Jan. durable orders strong aside from aircraft -
Thursday, February 24, 2005 2:21:50 PM
afxpress.com
WASHINGTON (AFX) - A big drop in aircraft orders masked growing demand for other U.S.-made durable goods in January, according to Commerce Department data released Thursday
Total orders for durable goods sank 0.9 percent in January as demand for civilian aircraft plunged by 27.1 percent, the Commerce Department reported Thursday
Excluding the 5.3 percent drop in orders for transportation goods, new orders increased 0.8 percent, surprising strength given the expiration of a tax break at the end of 2004 that economists suspected would slow investment growth in the early months of this year
Orders in December were revised higher to a 1.4 percent gain from 1.1 percent previously. Economists were looking for orders to be unchanged in January, according to a survey conducted by MarketWatch. In a separate report, the Labor Department said first-time claims for jobless benefits rose 9,000 to 312,000 last week, while the four-week average fell to a four-year low of 308,750. The bond market was largely unchanged following the data. "Traders overlooked the decline in the headline durable orders, noting instead the strength in the major components of the report," said analysts at Action Economics
Durable goods orders are extremely volatile, particularly for big-ticket items such as airplanes. A loss in one month can be made up with the stroke of the pen in the next. For instance, Boeing Co. won a new order for 140 planes from Ryanair on Thursday, worth about $4 billion. New orders are up 10.5 percent since January 2004
New orders for most categories were up in January, except for computers, cars and airplanes. The orders data do not include semiconductors
Shipments of durable goods rose 1.5 percent in the month after an upwardly revised 2.8 percent increase in December. The revision to December shipments should lead to a greater upward revision to fourth-quarter gross domestic product on Friday. Economists were already expecting the 3.1 percent estimate to be revised to 3.6 percent
Orders for core capital goods increased 2.9 percent in January after a 3.3 percent gain in December
Shipments of core capital goods - the best monthly measure of business investment - increased 3.7 percent in January
Inventories of durable goods increased 0.9 percent in January, while unfilled orders fell 0.2 percent
Transportation goods accounted for the decline in new orders. Orders for aircraft sank 27.1 percent in January after falling 16.8 percent in December. Motor vehicles fell 3.8 percent after a 4.9 percent rise in December. Defense aircraft jumped 56.9 percent after a 39.8 percent decline in December
Electrical equipment increased a record 13 percent while shipments rose 4.9 percent
Computers and electronics fell 1.2 percent while shipments increased 4 percent
Machinery increased 0.3 percent while shipments increased 2.6 percent
Primary metals increased 1.6 percent while shipments increased 2.3 percent. Orders and shipments for fabricated metals increased 1.2 percent |
