U.S. February Durable Goods Orders - Underlying trend remains positive
February durable goods orders are in line with expectations overall with a 1.4% decline led by the volatile aircraft sector correcting from recent strength, but a slightly stronger than expected ex transport increase of 0.8% maintaining a positive trend, indicating a positive business investment picture.
While this is a third straight decline in civil aircraft orders, they are simply back at a normal level after three straight strong months, with November’s having been exceptionally so. Elsewhere in the transport breakdown autos aw a strong 3.1% rise but defense, which has a large overlap with transport, was negative. Orders ex defense fell by 1.2%.
Ex transport orders have bow seen a tenth straight increase with a 6-month average of 0.6%. Ten months ago, trend was near flat. It is now clearly positive and while in part due to price gains is backed by stronger ISM manufacturing data in Q1 of 2026.
Non-defense capital orders ex aircraft, a key indicator of business investment, also have a 6-month average of 0.6% and ruse by that amount in February, though after a 0.4% January decline the rise in not so impressive. Shipments in the sector rose by 0.9% after a flat January. This is positive for Q1 GDP. Though a 0.1% rise in durable goods inventories after four straight gains of 0.2% is less so.
