Durable goods orders up 0.7% in March; ex-transportation slip 0.2%

WASHINGTON – The value of durable goods new orders rose 0.7% in March, considerably below the expected 1.5%, but were down 0.2% excluding transportation after five consecutive drops, data released by the Commerce Department Thursday showed.

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Analysts had expected orders excluding transportation to be up 0.4% in the month. While the headline and ex. transportation number were well below expectations, an upward adjustment to February should mute the effects on first quarter GDP estimates.

Defense capital goods saw a 12.2% rise in new orders, after February's 7.7% drop. Defense aircraft and parts also saw a considerable 26.1% rise after an 11.7% drop in February. Total inventories for defense aircraft and parts saw a modest decline of 1.1%. With inventories declining and new orders rising, there will need to be a significant increase in shipments next month to keep up with rising demand and prevent a run up in unfilled orders.

Nondefense aircraft and parts saw a more modest growth pace of 7.0%, a much smaller jump than last month's 57.2% growth. However, unadjusted nondefense aircraft and parts are up 10.6% from last year's level.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.
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