The durable goods orders report is a messy reading because of several skews and revisions but overall it points to a pickup in growth.
The main metric to watch is capital goods orders non-defense and excluding aircraft; it fell 1.2% which sounds worse than the 0.3% decline expected but it’s actually a solid reading. That’s because March orders were revised to show a 4.7% rise, much higher than the 2.2% reading initially reported.
On the main headline, orders rose 0.8% compared to -0.7% expected but it’s primarily due to a 39.3% rise in defense orders. The prior was also revised a full percentage point higher, largely due to transportation orders.
Overall, it’s a sign that business investment picked up sharply in March after a weak start to the year. US dollar traders were leaning toward a strong number ahead of the report and the dollar has given back some of the gains but the numbers are mostly good news and that should keep a bid under USD.
