U.S durable goods orders climb 1.2% in February despite the Coronavirus pandemic
- U.S durable goods orders climb 1.2% in February despite the Coronavirus pandemic.
- U.S durable goods orders jumped 0.4% on a year over year basis in February.
- Core capital goods shipments surged 0.7% in February versus 1.1% in January.
The U.S Census Bureau released its monthly report on new orders for the U.S manufactured durable goods in February on Wednesday. The data showed durable goods orders to have unexpectedly increased in the U.S in February. Due to the strict restrictions from the government directed at minimizing the fast spread of COVID-19, however, analysts expect the demand to go down in the upcoming months that will reflect as a decline in the U.S durable goods orders.
The Commerce Department announced a 1.2% growth in the U.S durable goods orders in February. Data for January was also revised on Wednesday that now suggested a 0.1% increase in orders as compared to a 0.2% decline as suggested earlier. Economists had expected a 0.8% drop in U.S durable goods orders in February.
U.S Durable Goods Orders Jumped 0.4% On A Year Over Year Basis
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On a year over year basis, the increase in durable goods orders was recorded at 0.4%. February’s increase was largely attributed to the transportation equipment that climbed 4.6% last month versus a 0.9% drop in January.
Civilian aircraft posted a 0.3% decline in new orders in February while a 1.8% increase in motor vehicles and relevant parts orders was also reported last month.
Excluding aircraft, non-defense capital goods saw a 0.8% decrease in new orders in February. In January, as per the revised data, it was capped at a 1.0% growth. Known commonly as the core capital goods orders, these are closely followed by the Commerce Department for valuable insight into business spending plans.
While primary metals, machinery, computers, and other electronic products posted a decline in new orders in February, electrical equipment, appliances, and related components were seen in demand with a 1.3% increase last month.
Core Capital Goods Shipments Surged 0.7% In February
Core capital goods shipments printed a 0.7% decline in February. It is a reliable measure for equipment spending for the government in the calculation of the GDP. Core capital goods shipments had previously surged 1.1% in January.
Business investment in the U.S has contracted in the past three quarters in a row that marks the longest run since the financial crisis of 2009. Economists blame Trump Administration’s trade war with China to have contributed the most in weighing the business investment.
The forex market responded moderately to the economic data on Wednesday. EUR/USD dropped 1.0830 to 1.0795 following the release of the Commerce Department’s monthly report on the U.S durable goods orders.