Orders for Durable Goods Rebound in May

Core capital goods orders–orders excluding defense and transportation and considered an indicator for business investment–dipped 0.1% after an upwardly revised 2.7% gain in April.

“Manufacturing is in good health,” said Ian Shepherdson of Pantheon Macroeconomics. “Surveys suggest that activity in the sector is no longer accelerating, but growth is strong.”

In a separate report on Thursday, the U.S. Bureau of Economic Analysis said real gross domestic product (GDP) increased at an annual rate of 6.4% in the first quarter of 2021. GDP rose 4.3% during the fourth quarter of 2020.

The Census Bureau’s May 2021 advance report on durable goods manufacturers’ shipments, inventories and orders follows:

New Orders

New orders for manufactured durable goods in May increased $5.7 billion or 2.3 percent to $253.3 billion. This increase, up 12 of the last 13 months, followed a 0.8 percent April decrease. Excluding transportation, new orders increased 0.3 percent. Excluding defense, new orders increased 1.7 percent. Transportation equipment, up following two consecutive monthly decreases, led the increase by $5.2 billion or 7.6 percent to $74.2 billion.

Shipments

Shipments of manufactured durable goods in May, up two of the last three months, increased $1.0 billion or 0.4 percent to $248.3 billion. This followed a virtually unchanged April decrease. Machinery, up seven of the last eight months, led the increase by $0.4 billion or 1.1 percent to $35.1 billion.

Unfilled Orders

Unfilled orders for manufactured durable goods in May, up four consecutive months, increased $9.5 billion or 0.8 percent to $1,209.3 billion. This followed a 0.4 percent April increase. Transportation equipment, up three of the last four months, led the increase by $3.1 billion or 0.4 percent to $806.2 billion.

Inventories

Inventories of manufactured durable goods in May, up four consecutive months, increased $2.9 billion or 0.7 percent to $445.3 billion. This followed a 0.7 percent April increase. Primary metals, up 10 consecutive months, led the increase by $0.9 billion or 2.4 percent to $38.5 billion.

Capital Goods

Nondefense new orders for capital goods in May increased $2.2 billion or 2.7 percent to $83.6 billion. Shipments decreased $0.5 billion or 0.7 percent to $77.7 billion. Unfilled orders increased $5.9 billion or 0.8 percent to $729.8 billion. Inventories increased $0.7 billion or 0.4 percent to $197.3 billion.

Defense new orders for capital goods in May increased $1.6 billion or 17.4 percent to $10.7 billion. Shipments decreased $0.3 billion or 2.6 percent to $11.9 billion. Unfilled orders decreased $1.3 billion or 0.7 percent to $190.6 billion. Inventories decreased less than $0.1 billion or 0.1 percent to $20.9 billion.

Revised April Data

Revised seasonally adjusted April figures for all manufacturing industries were: new orders, $487.3 billion (revised from $485.2 billion); shipments, $487.1 billion (revised from $487.8 billion); unfilled orders, $1,199.8 billion (revised from $1,196.9 billion) and total inventories, $725.0 billion (revised from $723.6 billion).