Durable Goods Orders Contract Faster

While new orders in durable goods contracted at their fastest annual rate in December, the rate of contraction should begin to slow in early 2020.

New orders for real durable goods totaled $247,645 million in December, which was down 5.2% from one year ago. Additionally, this was the fifth-straight month of contraction and the 10th month of contraction out of the last 11. The result was that the annual rate of change contracted 3.9%, moving at a faster rate of contraction for the fifth-straight month. This was the fastest rate of annual contraction since June 2016. However, durable goods orders should bottom out soon as consumer durable goods spending started growing at an accelerating rate in December.

Compared with one year ago, new orders for motor vehicles and parts contracted 4.5%. This was the fifth consecutive month of month-over-month contraction. The annual rate of growth, now 0.3%, decelerated for the sixth month. This was the slowest rate of annual growth since January 2018.

Aerospace orders decreased 43.8% in December, contracting more than 40% for sixth time in eight months. These large monthly contractions will likely continue for several more months. The annual rate of contraction was 34.2%, which was the fastest rate of contraction since November 2015.

Accelerating Growth: power generation

Decelerating Growth: HVAC, motor vehicle/parts

Accelerating Contraction: aerospace, computers/electronics, construction materials, durable goods, fabricated metal products, off-road/construction machinery,  primary metals, total capital goods

Decelerating Contraction: appliances, machinery/equipment, oil/gas-field/mining machinery, ship/boat building


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World Machine Tool Survey

An independent annual survey that collects statistics from machine tool consuming and producing countries and compares them in real U.S. dollars.

Capital Spending Survey

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Gardner Business Index

A diffusion index measuring month-to-month changes in activity at durable goods and discrete parts manufacturing facilities.