New orders for durable goods rose 0.3 percent in June, and the capital goods line rose four times as fast
$334.8 billion.
That is what American factories booked in new orders for long lasting manufactured goods in June, and it is $1.1 billion more than they booked in May. The Census Bureau put the advance report out at 8:30 this morning under release number CB 26-117. In percentage terms the increase is 0.3, the third rise in four months, and it follows a May fall the same report now measures at 4.0 percent.
Strip out transportation and the picture improves slightly. Orders rose 0.6 percent on that basis. Strip out defense instead and the figure is unchanged at 0.3 percent. Computers and electronic products did the heavy lifting, rising $0.9 billion or 3.1 percent to $31.1 billion, a category that has now increased in nine of the last ten months.
Shipments ran ahead of orders, which is the ordinary shape of a month when factories are working through a backlog rather than filling new demand. They rose $2.4 billion or 0.7 percent to $330.7 billion, also a ninth increase in ten months, with computers and electronic products again leading at 2.4 percent.
The backlog itself keeps building. Unfilled orders rose $9.3 billion or 0.6 percent to $1,590.1 billion and have now risen in 23 of the last 24 months, with transportation equipment accounting for most of the June increase at $1,002.4 billion. Inventories rose 0.3 percent to $602.0 billion, a ninth consecutive monthly rise.
For business investment the line to read is capital goods, and it moved four times as fast as the headline. Nondefense new orders for capital goods rose $1.2 billion or 1.2 percent to $97.8 billion. Shipments of the same category, which is the number that feeds through to the equipment component of GDP, rose 1.5 percent to $95.0 billion. Defense new orders rose 0.5 percent to $22.7 billion and defense shipments rose 4.0 percent to $19.5 billion.
May was revised up. New orders for all manufacturing industries are now recorded at $658.6 billion against the $657.4 billion first published, with shipments essentially unchanged and total inventories unchanged.
One caution belongs on every figure above, and it is the Census Bureau's own. The advance report is not built on a probability sample, so the agency does not compute a sampling error or a confidence interval for any of these estimates, and it marks the percentage changes to say that statistical significance is not measurable. A 0.3 percent monthly move is well inside the range where that caveat does real work. The fuller set of estimates, including nondurable goods, arrives on August 4, and the July advance report on August 26.
