Highlights of the US durable goods orders report:

  • June durable goods orders +0.7% vs +0.5% expected
  • Prior reading was -0.9% (revised to -1.0%)
  • Ex transportation +0.8% vs +0.5% expected
  • Capital goods orders non-defense ex-air +1.4% vs +0.5% expected
  • Prior Capital goods orders non-defense ex-air +0.7% (revised to -1.2%)
  • June core shipments -1.0% vs +1.3% exp (prior revised to -0.1% from +0.4%)
Cap goods orders non-def ex air

Cap goods orders non-def ex air

The strong cap goods orders non-def ex air number was good but the dramatic revision completely erases the positive sentiment. The knee jerk reaction is to see the US dollar.

The poor shipments data will also be a drag on Q2 GDP and will likely lead to another round of GDP estimate cuts.