The preliminary April US durable goods orders report:
- Capital goods orders non-defense ex-air (core) -0.8% vs +0.3% exp
- Prior core orders -0.8% (revised to -0.1%)
- Ex transport +0.4% vs +0.3% expected
- Prior ex transport -0.2% (revised to +0.1%)
- Capital goods shipments non-defense ex-air (core) +0.3% vs +0.1% exp
- Prior core shipments 0.0% (revised to -0.3%)
Very strong on the headline but it's a miss on core orders, despite the upward revision to the March number.
There's clearly some kind of skew from the transportation orders side here. When you strip that out, this is yet-another weak report.
Looking through the data tables, there is a 64.9% m/m rise in nondefense aircraft orders and 2.9% rise in vehicle and parts orders. Those are one-off events based on the timing of order bookings from Boeing and a likely seasonal skew in autos. Strip that out and it's still an economy that's not buying durable goods.
On an annualized basis, the 3 month average is down 8.7% and year-over-year core orders are down 6.7%. Core shipments are also down 6.0% y/y.
The headlines looks nice but this has been one of the worst economic data points for many months now. and that's true once again in the April numbers.