Updated: 04-Mar-10 10:39 ET
| January Factory Orders |
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| Updated: 04-Mar-10 10:39 ET |
Highlights
- Factory orders increased 1.7% in January after increasing an upwardly revised 1.5% in December.
- The consensus expected an increase of 1.8%.
Key Factors
- Last week’s advance durable goods report overestimated durable goods orders as they increased 2.6% in January, down from 3.0% in the advance release.
- Nondefense aircraft remained the driver in factory orders. Aircraft orders increased 118.6% in January. If aircraft orders had held steady from December, total factory orders would have only increased 0.7%.
- Nondurable goods orders rose 0.9%. Growth was in-line with the 0.7% jump in nondurable goods production, but was well below consumer demand for nondurable goods.
- First quarter business investment looks incredibly weak. Orders of nondefense capital goods excluding aircraft were revised down to -4.1% in January from -2.9% in the advance release. Shipments were revised down from -1.5% to -1.7%.
Big Picture
- Factory orders were very weak in the fourth quarter of 2008 and early 2009. This was due to severe weakness in durable orders and a downtrend in nondurable orders in late 2008. The rate of decline has eased and a sustainable uptick seems to be here.
| Category | JAN | DEC | NOV | OCT | SEP |
| Factory Orders | 1.7% | 1.5% | 1.0% | 0.8% | 1.6% |
| Less Defense | 1.0% | 1.5% | 2.1% | 1.4% | 1.5% |
| Durable Goods | 2.6% | 1.8% | -0.4% | -0.1% | 2.2% |
| Nondurable Goods | 0.9% | 1.3% | 2.2% | 1.6% | 1.1% |
| Unfilled Factory Orders | 0.0% | -0.9% | -0.7% | -0.4% | -0.4% |
| Factory Shipments | 0.3% | 1.9% | 1.6% | 0.9% | 1.3% |
| Factory Inventories | 0.2% | -0.2% | 0.2% | 0.4% | -1.3% |
| Inventory/Shipment Ratio | 1.29 | 1.29 | 1.32 | 1.34 | 1.35 |
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