Manufacturing Sector Set for Greater Economic Growth
Piggybacking on yesterday’s upside surprise for new orders in the ISM manufacturing index for November, Factory Orders reported a 1.1 percent gain in new orders for manufactured goods in November. October showed a gain of 0.8 percent in manufactured goods orders. Economists were expecting a gain of 0.4 percent for November. Excluding transportation, new orders increased 1.9 percent.
Defense spending and electronic products sales help lift the dollar level for durable goods to 0.2 percent, following a dip of 0.7 percent in October. Orders for nondurable consumer goods rose 1.8 percent over October’s 2.2 percent rise.
Shipments of manufactured durable goods rose for the third month in a row (0.2 percent) reflecting an increase in machinery shipments. Shipments of nondurable goods increased 1.8 percent, largely due to petroleum and coal increases, following October’s 2.2 percent increase.
Unfilled orders continued its downward trend for the last fourteen month, indicating orders are keeping better pace with production. Factory inventories remain lean, with finished goods inventories dropping 0.4 percent for durables and 0.1 percent for nondurables.
Durable goods include hard goods such as automobiles; nondurable goods include cigarettes, food, and energy.
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