New orders for manufactured durable goods in June decreased $4 billion or 2.1 percent to $192 billion, according to the advance report released by the U.S. Census Bureau. This decrease, down two of the last three months, followed a 1.9 percent May increase.
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Excluding transportation, new orders increased 0.1 percent. Excluding defense, new orders decreased 1.8 percent. Transportation equipment, also down two of the last three months, had the largest decrease, $4.2 billion or 8.5 percent to $45.4 billion. This was due to nondefense aircraft and parts which decreased $2.8 billion.
\”The reason for the solid performance is that so much capacity was shed, and so quickly, during the recession that even the current modest recovery in production creates bottlenecks and highlights the need to replace and upgrade machinery and equipment,\” says Daniel J. Meckstroth, chief economist for the Manufacturers Alliance/MAPI. \”Having strong profit gains and a tax incentive for accelerated depreciation motivates corporations to make long-term investments in their business operations. We continue to believe that business equipment growth will greatly exceed that of the pace of growth in the general economy.\”
Shipments of manufactured durable goods in June, up six of the last seven months, increased $1 billion or 0.5 percent to $196 billion. This followed a 0.5 percent May increase. Machinery, up four of the last five months, had the largest increase, $0.7 billion or 2.6 percent to $29.1 billion.
Unfilled orders for manufactured durable goods in June, up fourteen of the last fifteen months, increased $2.1 billion or 0.2 percent to $862.7 billion. This followed a 0.9 percent May increase. Machinery, up seventeen consecutive months, had the largest increase, $2.1 billion or 2.0 percent to $111.2 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 3.4 percent May increase.
Inventories of manufactured durable goods in June, up eighteen consecutive months, increased $1.6 billion or 0.4 percent to $357.2 billion. This was at the highest level since the series was first published on a NAICS basis and followed a 1.2 percent May increase. Transportation equipment, also up eighteen consecutive months, had the largest increase, $1.2 billion or 1.1 percent to $109.1 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 1.7 percent May increase.
Nondefense new orders for capital goods in June decreased $3.0 billion or 4.1 percent to $69.8 billion. Shipments increased $0.7 billion or 1.1 percent to $67.7 billion. Unfilled orders increased $2.1 billion or 0.4 percent to $504.7 billion. Inventories increased $2.1 billion or 1.3 percent to $162.7 billion. Defense new orders for capital goods in June decreased $0.3 billion or 3.9 percent to $8.6 billion. Shipments decreased $0.1 billion or 1.6 percent to $7.8 billion. Unfilled orders increased $0.9 billion or 0.6 percent to $150.3 billion. Inventories decreased $0.5 billion or 2.3 percent to $20.3 billion
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