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Transportation Increases Propel Durable Goods Orders to Sharp Increase

Byeditor

Mar 26, 2024

In February, durable goods orders rose following a decline in the previous two months. The increase was driven by strong sales of aircraft and other transportation equipment, which are considered infrequently-purchased items. The Census Bureau reported a 1.4% increase in new durable goods orders, surpassing the 1.0% forecasted by economists.

After a slight decrease in December, durable goods orders saw a significant drop in January, particularly in transportation orders. BMO’s Senior Economist Jay Hawkins noted that the rebound in the interest-rate sensitive manufacturing sector may be uneven until the Fed starts to ease policies in the summer.

The report also showed a 3.3% increase in transportation equipment spending, primarily due to aircraft sales. This growth reversed two months of declines and coincided with production issues at Boeing, which led to the resignation of its CEO Dave Calhoun. Excluding volatile transportation sales, new durable goods orders increased by 0.5%.

Overall, the latest data suggests that durable goods orders are seeing some positive momentum, particularly in the transportation sector. Economists are continuing to monitor the situation and provide analysis on the implications of these trends.

By editor

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