DURABLE ORDERS SURPRISE?

Durable Orders Jump in February (what good is any of this with such HUGE DOWNARD REVISIONS?)

Last Update: 25-Mar-09 08:53 ET briefing.com
Like some other data of late, the February durable goods report turned out to be better than expected. Specifically, orders for durable goods increased 3.4% (consensus -2.5%), breaking a six month streak of declines. Excluding transportation, orders rose 3.9% (consensus -2.0%).

The January numbers, however, were both revised noticeably lower with total orders down -7.3% (prior -5.2%), and orders, excluding transportation, down -5.9% (prior -2.5%). Taking these revisions into account, the February data ends up being much closer to expectations.
The latter point notwithstanding, the February data still don't look as dour as the prior month when declines in orders and shipments were seen for just about every industry grouping. Notably, new orders for machinery increased 13.5% in February. Computers and electronic products orders were up 10.1% and defense aircraft and parts orders were up 32.4%.
Nondefense capital goods orders, excluding aircraft, jumped 6.6%, which is a hopeful sign for business investment. However, it is too early to read too much into this one month increase, which could be more of a temporary bounce after a -11.3% drop in January and a -5.9% decline in December.
Unfilled orders declined -1.3% and inventories dropped -0.9%.
Total shipments fell -0.5% in February, following a -5.2% decline in January, so the business investment component of GDP can still be deemed to be on the poor side of things.