The 2020 Mid-Year Economic Update_long

Durable Goods New Orders Down 2% in August

Transportation equipment led the decrease, down 5.8 percent.

New orders for manufactured durable goods in August decreased $4.8 billion, or 2 percent, to $236.3 billion, the U.S. Census Bureau announced. This decrease, down after two consecutive monthly increases, followed a 1.9 percent July increase. Excluding transportation, new orders decreased less than $0.1 billion. Excluding defense, new orders decreased $2.2 billion, or 1 percent.

Transportation equipment, also down following two consecutive monthly increases, led the decrease, $4.8 billion or 5.8 percent to $78.7 billion.

Shipments of manufactured durable goods in August, down following two consecutive monthly increases, decreased less than $0.1 billion, or virtually unchanged, to $243.2 billion. This followed a 1 percent July increase.

Primary metals, down 10 of the last 11 months, drove the decrease, $0.2 billion or 1 percent to $20.5 billion.

Unfilled orders for manufactured durable goods in August, down following two consecutive monthly increases, decreased $2.2 billion or 0.2 percent to $1,195.3 billion. This followed a 0.2 percent July increase.

Transportation equipment, also down following two consecutive monthly increases, led the decrease, $2.1 billion or 0.3 percent to $800.3 billion.

Inventories of manufactured durable goods in August, up two of the last three months, increased $0.1 billion, or virtually unchanged, to $401.4 billion. This followed a 0.2 percent July decrease.

Transportation equipment, up four of the last five months, drove the increase, $0.9 billion or 0.7 percent to $132.5 billion.

Nondefense new orders for capital goods in August decreased $1.6 billion or 2 percent to $80.4 billion. Shipments increased $1.4 billion or 1.8 percent to $80.8 billion. Unfilled orders decreased $0.3 billion, or virtually unchanged, to $761.6 billion. Inventories decreased $0.4 billion or 0.2 percent to $176.5 billion.

Defense new orders for capital goods in August decreased $2.7 billion or 24.3 percent to $8.6 billion. Shipments decreased $0.5 billion or 4.6 percent to $10 billion. Unfilled orders decreased $1.4 billion or 1 percent to $148.8 billion. Inventories increased $0.7 billion or 3.1 percent to $23.7 billion.

“The durable goods report for August is consistent with slow growth in manufacturing output growth this summer,” said Dan Meckstroth, chief economist for the MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation. “Thankfully, U.S. domestic demand is a solid base of moderate growth that counteracts some of the international weakness of late. The MAPI Foundation believes that manufacturing will accelerate in fall but not enough to prevent the industrial sector from posting only modest growth for the year as a whole. Manufacturing industrial production will grow only 2.1 percent in 2015, slightly slower than the growth rate of the overall economy.”

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