Source: Economics Group of Wells Fargo Bank, N.A.
Summary
The best that can be said of today’s durable goods report for April is that there are signs of life in spending on info-processing equipment, and the drop in civilian aircraft orders was not as big as feared. But underlying orders activity is sputtering after firms front-loaded orders pre-tariffs.Underlying Orders Losing Ground
Durable goods orders fell 6.3% in April amid a drop in civilian aircraft orders (chart). Coming on the heels of a 158% surge in aircraft orders the prior month and amid fairly soft orders data from Boeing, we had been expecting a larger decline than the 51% drop in aircraft that was revealed in today’s report (chart).