U.S. February Durable Goods Orders - Trend flat to marginally positive
February durable goods orders are in line with expectations with a 1.4% increase overall, 0.5% ex transport, following declines of 6.9%b and 0.3% respectively in January. Underlying trend ex transport remains near flat though marginally positive. Ex defense saw a 2.2% ruse after a 7.9% January fall.
The ex-transport series has not seen a move of more than 1.0% in either direction for over two years and the latest rise reverses declines seen in December and January. The six month average remains marginally positive, at 0.1%.
Transport rose by 3.3% after a fall of 18.3% in January with aircraft seeing only a modest upward correction from a steep January decline which followed two very strong months. Autos were firm with a rise of 1.8%. Defense, which has a large overlap with transport, was weaker, with defense capital down 12.7% after a 20.2% January increase.
Non-defense capital orders ex aircraft, a key signal for business investment, rose by 0.7% after a 0.4% January decline, though shipments in the sector fell by 0.4% after a 0.8% January increase, overall leaving a marginally positive picture for Q1 to date. A 0.3% rise in inventories will also give modest support to GDP.
