Headline durable goods orders fell 1.8% in May, more than was expected by economists.
Expectations were for headline durable goods orders to fall 1% in May against the prior month, but rise 0.5% when excluding items like transportation and defence orders.
Durable goods orders excluding aircraft and defence orders, or “core” orders, rose 0.4% in May, a bit less than expected.
Excluding defence, orders rose 2.1% in May.
For the first time in 23 months, inventories of durable goods fell 0.2% in May.
Last month, durable goods orders fell 1%.
In a note to clients following the report, Bricklin Dwyer at BNP Paribas noted 2 takeaways from the report:
- Orders are running at a disappointing pace, and;
- Shipments disappointed in May after they were revised lower in April following the factory orders report.
Dwyer added that this report takes BNP’s Q2 GDP tracking estimate down to 3.4% from 3.5% and said the report will likely be viewed negatively by policymakers.
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