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 1.4% in February
Posted Under: Data Watch • Durable Goods
Supporting Image for Blog Post

 
Implications: An ugly report on durable goods from February. Orders fell 1.4%, much weaker than the expected 0.2% increase. However, this is not the end of the economic expansion. Three special factors have held orders back – less drilling activity, West Coast port strikes, and abnormally cold winter weather. Most of the decline was in the transportation sector – particularly aircraft – which is extremely volatile month to month. Still, orders excluding transportation declined 0.4% and have now dropped for five consecutive months. This is no different than what happened in 2012, when orders also fell for five consecutive months, yet real GDP accelerated in 2012 from 2011. Despite recent declines, orders ex-transportation still remain up a Plow Horse 2.3% from a year ago. "Core" shipments, which exclude defense and aircraft, rose 0.2% in February and are up 4.6% from a year ago. Still, if unchanged in March, "core" shipments will be down at a 0.9% annual rate. Plugging these data into our models for overall real GDP puts our forecast for Q1 at a 1.0% annual rate. Moving forward, we expect to see a rebound in orders and shipments as temporary headwinds recede. Consumer purchasing power is growing with more jobs and higher incomes, while debt ratios remain very low, leaving room for an upswing in big-ticket spending. Meanwhile, profit margins are high, corporate balance sheets are loaded with cash, and capacity utilization is breaching long-term norms, leaving more room (and need) for business investment.

Click here for PDF version
Posted on Wednesday, March 25, 2015 @ 10:57 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
New Single-Family Home Sales Rose 7.8% in February
The Consumer Price Index Increased 0.2% in February
Existing Home Sales Increased 1.2% in February
Don't Fret Student Debt
M2 and C&I Loan Growth
Yellen Loses “Patience,” But Maintains Flexibility
Housing Starts Declined 17.0% in February
Industrial Production Rose 0.1% in February
Resist the Rate-Hike Huff
M2 and C&I Loan Growth
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.