Durable Goods Shipments Increase in March but New Orders Slide
April 24, 2013
The government’s first look at shipments and new orders for manufactured durable goods in the U.S. during March shows mixed performance.
The U.S. Commerce Department reports shipments increased in March from the month before by 0.4% to $230 billion. This is the highest level on record, going back to 1992. The hike marks the sixth one out of the past seven months. Driving the March performance higher was a 2.1% increase in shipments of transportation orders.
In contrast, new orders fell in March by 5.7% to $216.3 billion, marking the second drop out of the last three months. February orders increased 4.3% over January’s level. Transportation also played a big role in the March drop, falling 15%, especially due to a drop in aircraft orders.
New orders for the closely watched core capital goods, which includes machinery and equipment, edged up 0.2%.
Durable goods are generally known as big-ticket items that are designed to last three years or more.
Some analysts have not been surprised by the slowdown in durable goods shipments and orders, due to the federal budget sequester and Social Security taxes on payroll returning to normal the first of the year, reducing the take-home pay of workers.
A better read on the overall health of the economy is expected Friday when the Commerce Department is expected to release its first look at the nation’s gross domestic product performances from January through March.