Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
 
 

Blog Home
   Brian Wesbury
Chief Economist
 
Bio
X •  LinkedIn
   Bob Stein
Deputy Chief Economist
Bio
X •  LinkedIn
 
  New Orders for Durable Goods Declined 0.9% in December
Posted Under: Data Watch • Durable Goods • Employment • GDP • Government • Fed Reserve • Interest Rates • COVID-19
Supporting Image for Blog Post

 
Implications:  New orders for durable goods fell slightly short of consensus expectations in December, but the decline was heavily concentrated in the notoriously volatile transportation category.  Strip out transportation, and the headline decline of 0.9% in December turns into a 0.4% rise, while upward revisions to prior months show "core" activity in December was up 0.6% from the originally reported pace of orders in November.  In 2021, durable goods orders rose an impressive 12.7%, representing the largest full-year increase since 2011.  And with a combined 65.4% increase since the April 2020 bottom, new orders now sit 15.9% above the pre-pandemic high in February 2020, signaling a sharp (and more checkmark than V-shaped) recovery in durable goods.  Looking at the details of today's report, the volatile transportation sector once again lived up to its name, with sizeable declines in orders for both commercial and defense aircraft partially offset by a rise in orders for autos.  Beyond transportation, orders were mixed in December, with primary metals (+2.0%) and fabricated metal products (+1.5%) rising, while orders for computers & electronic products (-2.8%), and machinery (-0.1%) declined.  One of the most important pieces of today's report, shipments of "core" non-defense capital goods ex-aircraft (a key input for business investment in the calculation of GDP), rose 1.3% in December.  In the fourth quarter, these shipments rose at an 8.6% annualized rate versus the Q3 average.  For a deeper dive on how the U.S. economy performed in Q4, click here to read our analysis of the fourth quarter GDP report released this morning.  In other news, initial jobless claims fell 30,000 last week to 260,000.  Meanwhile, continuing claims for regular benefits rose 51,000 to 1.675 million.  Plugging these figures into our models suggests continued job growth in January.  Given the heightened attention on the Federal Reserve as it plans rate lift-off at the next meeting in March, every report on employment or inflation will get elevated scrutiny as market participants try to gauge how it will impact the pace (and magnitude) of Fed moves in the year ahead.

Click here for a PDF version
Posted on Thursday, January 27, 2022 @ 11:58 AM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
Search Posts
 PREVIOUS POSTS
Real GDP Grew at a 6.9% Annual Rate in Q4
Liftoff in March
New Single-Family Home Sales Increased 11.9% in December
COVID-19 Tracker 1/24/2022
The 2021 Finish: Fast Growth, High Inflation
Recovery Tracker 1/21/2022
Existing Home Sales Declined 4.6% in December
Housing Starts Increased 1.4% in December
Who Gets the Blame for Inflation
Recovery Tracker 1/14/2022
Archive
Skip Navigation Links.
Expand 20242024
Expand 20232023
Expand 20222022
Expand 20212021
Expand 20202020
Expand 20192019
Expand 20182018
Expand 20172017
Expand 20162016
Expand 20152015
Expand 20142014
Expand 20132013
Expand 20122012
Expand 20112011
Expand 20102010

Search by Topic
Skip Navigation Links.

 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.