Long Term Perspective

New orders for durable goods reveal demand for consumer goods such as cars and home appliances as well as investment equipment such as lathes and computers.  Transportation is a relatively volatile component within durables orders due to the lumpy nature of aircraft orders—civilian and defense. Analysts prefer to follow durables excluding transportation in the short-term to see the underlying cyclical trend.   Over the long run durables overall and excluding transportation tend to track each other.

Short Term Perspective

Durable goods orders rebounded a monthly 9.8 percent in September after a sharp 13.1 percent plunge in August. The comeback was largely due to aircraft orders within the transportation component—where weakness was in August.   Excluding transportation, orders rose 2.0 percent after decreasing 2.0 percent in August.  Civilian aircraft (Boeing) has really jerked around the total and especially the transportation component. The transportation component rebounded a monthly 31.3 percent after a 33.7 percent plummet in August.  Outside of transportation, new orders were mixed.  Gains were seen in primary metals, machinery, and “other.”  Declines were seen in fabricated metals, computers & electronics, and electrical equipment.  Numbers reflect revisions from the more recent total factory orders report.