U.S. factory orders rose in July. Sequentially, orders were up 1.4 percent, a rebound from the previous few months. While the out-turn was slightly above expectations of a rise of 1 percent, the composition of today’s report was widely consistent with forecasts. Most of the rise in orders came from non-defense aircraft, which is a volatile category, as orders for Boeing possibly recovered from the previous lows. Stripping this category, orders for capital goods rose just a modest 0.2 percent on a sequential basis. This is in line with the other incoming data that indicate towards sluggish momentum in the manufacturing sector.
With the revised data for the durables categories coming in close to previous estimates, the news from this release was mainly about nondurable goods orders, noted Barclays in a research report. According to the estimates, the non-durable goods orders rose 0.8 percent sequentially in July, following two straight months of declines. However, on a three-month-on-three-month saar basis, orders for nondurables continue to be weak relative to the second quarter levels.
