2017 Economic Calendar
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Factory Orders  
Released On 4/4/2017 10:00:00 AM For Feb, 2017
PriorPrior RevisedConsensusConsensus RangeActual
Factory Orders - M/M change1.2 %1.5 %1.0 %0.4 % to 1.1 %1.0 %

Factory orders may not be showing the same kind of strength that the ISM and Philly Fed are pointing to but they are solid, hitting Econoday's February consensus at a 1.0 percent gain. Adding to the strength is a 3-tenth upward revision to January which is now at a 1.5 percent gain that follows December's unrevised 1.3 percent rise.

The durables side of the report, up 1.8 percent in the month (revised from 1.7 percent in last week's advance data), reflects a second month of outsized strength for aircraft, at a 56 percent monthly gain vs January's 188 percent surge. But durables also include a respectable 0.3 percent gain for vehicles. Nondurable goods inched 0.2 percent higher on strength in chemicals (there is no advance report for nondurables).

But there are cracks that perhaps betray the strength and one is a second weak month for core capital goods (nondefense ex-aircraft) where orders fell 0.1 percent after managing only a 0.2 percent gain in January. Yet given strength of prior orders, shipments of core capital goods -- which are an input into first-quarter GDP -- rose a very solid 1.0 percent to help offset January's disappointing 0.4 percent decline. This is an important positive for first-quarter GDP which had been slipping.

Turning back to weaknesses, total unfilled orders were unchanged in February to extend a nearly yearlong streak of disappointment. Lack of unfilled orders will not spark demand for factory hiring. Inventories rose 0.2 percent in line with a 0.3 percent rise in total shipments to keep the inventory-to-shipments ratio unchanged at 1.31.

Another question in this report is the two months of reliance on aircraft orders where strength cannot be expected to extend indefinitely, to say the least for this volatile component. And this morning's trade report poses further questions especially for capital goods exports which have been stubbornly flat. Still, on a total basis, factory orders are showing the directional lift that advance anecdotal reports have been signaling with rare strength.

Consensus Outlook
Factory orders are on the rise and are expected to climb 1.0 percent at the headline level in February. Civilian aircraft, as indicated in the advance durable goods report, are expected to boost February's totals as they did in January. But capital goods orders, which offer a measure that goes to the heart of business investment, have been weak and have not confirmed the enormous strength in business confidence.

Factory orders represent the dollar level of new orders for both durable and nondurable goods. This report gives more complete information than the advance durable goods report which is released one or two weeks earlier in the month.  Why Investors Care
Even though monthly shipment data fluctuate less than new orders, both series show underlying trends more clearly by looking at year-over-year changes. In 2005 for example,new orders rose more rapidly than shipments due to large gains in aircraft orders. Aircraft orders have a long lead to shipment.
Data Source: Haver Analytics

2017 Release Schedule
Released On: 1/62/33/64/45/46/57/58/39/510/511/312/4
Release For: NovDecJanFebMarAprMayJunJulAugSepOct

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