Durable Goods Orders Fastest Growth since Sept. 2014

(Positive) Real durable goods new orders in February 2016 were $222,429 million. Compared with one year ago, durable goods new orders were up 4.1 percent, which was their fastest rate of growth since September 2014. New orders have increased in two of the last four months. As a result, the annual rate of change, now -3.9 percent, clearly contracted at a slower rate and contracted at its slowest rate since August 2015. The trend is moving in a positive direction.

Motor vehicle and parts orders increased at a rate of 15.9 percent compared with one year ago. That was the 15th straight month that MV&P orders increased. Also, it was the fastest rate of month-over-month growth since May 2012. As a result, the annual rate of change accelerated to its fastest rate of growth since January 2014.

Aerospace orders decreased 13.0 percent compared with one year ago after a whopping 37.0 percent increase last month. Still orders have increased compared with one year ago in three of the last five months. And, the annual rate of change has contracted at a decelerating rate for six months. This positive trend in aerospace orders should continue in upcoming months as the quarterly rate of change has been growing at a faster rate for four months.

We use real durable goods new orders to forecast activity in metalcutting job shops, metalworking, and durable goods.