Durable goods orders come in mixed;  leaving only employment indicators as short-term positives for the economy

– by a New Deal Democrat

Durable goods manufacturer orders, and in particular “core” orders that exclude defense and transportation (a/k/a Boeing), are a short (albeit noisy) leading indicator. I usually don’t pay much attention to them because of this noise and because they are less reliable than other indicators; but until recently they were one of the few remaining positive short leading indicators – so I was interested in when they might turn around.

Here’s a long-term look at each of them over the past 25 years:

In short, while total durable goods orders rose 5.6% for the month, orders for fixed capital goods fell -0.2%:

That’s not quite a “reversal,” but then again, core orders for capital goods haven’t hit a new high since August.

The main thing is that they are basically neutral. At this point, only labor market indicators remain positive for the economy in the short term.

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