Factory Orders for June 2010 - New Orders down, -1.2%

The Manufacturers’ Shipments, Inventories and Orders for June 2010 was released today. This report is commonly referred to as Factory Orders in the press and refers to domestic manufactured goods.

The breakdown in change from last month:

  • New orders: -1.2%
    • Durable: -1.2%
    • Non-Durable: -1.3%
  • Shipments: -0.8%
  • Unfilled orders: 0.0%
  • Inventories: -0.1%

Excluding transportation, new orders decreased -1.1%. Transportation new orders had a 5.9% increase. Turbines, power had a +19.1% monthly increase and industrial machinery dropped -8.7%.

 

 

New orders are still not up to pre-recession levels.

Below is the capital goods new orders graph, removing defense and aircraft. Both are considered volatile and not the true core of manufacturing economic growth. Non-Defense Capital goods excluding aircraft increased +0.2%.

 

 

The fact that inventories decreased, when Q2 2010 GDP had private inventories increase, implies downward revision on Q2 GDP.

Inventories of manufactured nondurable goods, down two consecutive months, decreased $3.7 billion or 1.7 percent to $211.2 billion. This followed a 2.5 percent
May decrease. Petroleum and coal products led the decrease, down $3.5 billion or 8.6 percent to $37.5 billion.

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ZeroHedge, JP Morgan says inventories pulled GDP 1.7%

ZeroHedge has a post claiming real Q2 GDP is 1.7%.

Frankly I have no doubt this is true, but I'm not pulling it into factory orders because I haven't been able to find the actual nondurable good inventories numbers the BEA used to calculate Q2 GDP to verify.

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