Durable goods increased $2.9 billion or 1.3% to $219.3 billion, the U.S. Census Bureau announced on August 27. This was the third consecutive monthly increase and followed a 1.3% June increase.
"The 1.3% increase in July durable goods orders was surprisingly strong given the recent declines in industrial activity and weak economic growth," said Daniel J. Meckstroth, Chief Economist for the Manufacturers Alliance/MAPI. "Nondefense capital goods orders excluding aircraft, an indicator for business equipment investment, were up an even stronger 2.6% in July. These upbeat capital goods numbers amid a downtrodden U.S. consumer sector indicates how helpful a weak dollar is in the current cycle.
"Tightfisted consumers are not expanding purchases of imports while U.S. manufacturers benefit from exports that continue to grow at an impressive rate," he added. "The lessened foreign competition and robust foreign orders, particularly for machinery and metals, is cushioning the industrial downturn."
Excluding transportation, new orders increased 0.7%. Excluding defense, new orders increased 2.8%.
Transportation equipment, up two of the last three months, had the largest increase, $1.7 billion or 3.1% to $57.5 billion.
Inventories of manufactured durable goods in July, up twelve of the last thirteen months, increased $2.7 billion or 0.8% to $335.8 billion.
Nondefense new orders for capital goods in July increased $4.5 billion or 6.3% to $76.3 billion.
Unfilled orders for manufactured durable goods in July increased $6.6 billion or 0.8% to $824.4 billion. Machinery had the largest increase, $3.9 billion or 3.8% to $105.5 billion.