‘Business Investment’ Proxy Weakens In November, Durable Goods Orders Buoyed By Big Boeing Buy

‘Business Investment’ Proxy Weakens In November, Durable Goods Orders Buoyed By Big Boeing Buy

A dark cloud hid over today’s durable goods data. While the headline print was solid, the value of core capital goods orders, a proxy for business investment in equipment that excludes aircraft and military hardware, dropped 0.1% in preliminary November data (following an upwardly revised 0.9% increase in October). This is only the second MoM drop since the COVID lockdown crisis…

Source: Bloomberg

The silver lining, as we noted above, was that orders for all durable goods (items meant to last at least three years) surged 2.5% from the prior month, reflecting a sharp rise in aircraft orders. That is the biggest jump since May.

Source: Bloomberg

The durables data showed bookings for commercial aircraft increased 34.1%. Boeing Co. reported 109 orders in November, up from 10 a month earlier. The government data on aircraft orders don’t always align exactly with the corporate figures. And also ‘war is good’ as Defense orders jumped 16.0% MoM…

Source: Bloomberg

Orders for motor vehicles rose 1%. Durable goods orders excluding transportation equipment increased 0.8%.

Outside of the more volatile transportation categories, the report was mixed. Bookings for metals and communications equipment increased, while those for machinery, electrical equipment and computers eased.

Finally, we note that unfilled orders for manufactured durable goods, a measure of backlogs, rose 0.7% to the highest since Feb 2020…

Source: Bloomberg

So the supply chain crisis is not over then?

Tyler Durden
Thu, 12/23/2021 – 09:19

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