Americans Driving and Flying, But Not Buying Much
An important barometer of economic health, orders of durable goods, showed remarkable strength in headline March data released this morning by the Commerce Department. But a closer look into the 4 percent increase over February showed that strength was driven by two unique areas: transportation and technology.
Cut them out and focus mainly on manufacturing equipment and business investment, and the numbers don’t look nearly as rosy, said Theodore Cangero, data scientist at the American Institute for Economic Research.
Orders of capital goods were up 4.8 percent in March, he said, but exclude aircraft and orders were actually down 0.5 percent, he noted.
Within transportation, orders of motor vehicles and parts were up 5.4 percent in March while orders for civilian aircraft jumped 30.6 percent, and defense aircraft surged 112.8 percent.
On the technology side, orders for computers and other technology products rose 3.0 percent.
Among the weaker details, orders of new machinery were down 1.5 percent in March, and down 17.6 percent over the last three months on an annualized basis, he said. Orders for primary metals used in the manufacturing of products or construction were down 0.2 percent in March, and were down an annualized 18.2 percent over the last three months, he said. Orders for the catchall “Other Durable Goods” category, which is primarily household goods, fell 0.3 percent in March.