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2008 Economic Calendar |
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
| Released on 6/2/06 For Apr 2006 | ||||||||||||
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Highlights
Factory orders fell sharply in April posing the latest evidence of economic slowdown. Orders were down 1.8 percent in the month against an outsized 4.0 percent jump in March that stands in contrast to an otherwise soft trend. Non-defense aircraft & parts as usual skewed results, down 29.1 percent in April vs. a 59.9 percent jump in March. Note that motor vehicles & parts showed a 1.7 percent increase. Excluding transportation, orders edged 0.2 percent higher in April vs. a 2.5 percent gain in March and a 2.5 percent decline in February. This is the critical reading that the markets and policy makers will consider most closely, and it, like yesterday's ISM manufacturing report for May, points to slowing growth. The report is another weight on the scale for an end to Federal Reserve rate hikes.
Durable goods orders fell 4.4 percent in April with orders for non-durable goods, reflecting a 3.5 percent gain in petroleum & coal, up 1.2 percent. Demand for metals is strong, consistent with industry comments. Orders for primary metals rose 3.2 percent and included a 4.7 percent rise at iron & steel mills. Fabricated metals rose 1.7 percent. Other categories were mostly weak including a 10.8 percent drop in computers & electrical products and a 0.4 percent dip for machinery.
Capital goods data were mostly weak with orders dropping 8.1 percent overall and down 1.7 percent for nondefense goods excluding aircraft. But shipments in this latter category were solid, up 1.0 percent in a reading that will boost calculations for nonresidential fixed investment. But remember shipments lag orders and the weak new order data will weigh on future forecasts.
Factory orders jumped 4.1 percent in March, spurred by a surge in durable goods orders. New orders for durable goods plunged 4.8 percent in April as aircraft orders declined for the month. Many of the key categories posted gains, but new orders for computers & electronics plunged for the month.
Factory Orders Consensus Forecast for Apr 06: -2.2 percent
Range: -0.5 to -2.8 percent
![[Chart]](chart.gif)
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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, new orders rose more rapidly than shipments due to large gains in aircraft orders. Aircraft orders have long a long lead to shipment. |
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