U.S. November Durable Goods Orders - Aircraft surge, underlying trend moderately positive
November’s durable goods orders report with gains of 5.3% overall and 0.5% ex transport is stronger than expected, though the picture of a strong headline field by aircraft and a continued moderately positive ex transport picture is in line with consensus.
Orders for non-defense aircraft almost doubled, as implied by strong data from Boeing, more than fully explaining a 14.7% rise in transport orders. Autos fell by 0.5% and defense capital, which has a strong overlap with transport, fell by 14.3%. Orders surged 6.6% ex defense.
Ex transport trend remains positive with a rise of 0.5%, regaining momentum after a subdued 0.1% increase in October. We have now seen seven straight gains ex transport with a 6-month average of 0.5%.
Non-defense capital orders ex shipments are also maintaining a positive trend with a rise of 0.7% while shipments in the sector rose by 0.4%, which is supportive for Q4 GDP, though not sharply. A second straight 0.2% rise in inventories after two straight declines of 0.1% is another modest positive for GDP.
