Durable Goods Report Points to Momentum Shift

Don’t Mistake Backlog Production with Resilience Source: Economics Group of Wells Fargo Bank, N.A. Summary A big picture take on all of this morning’s data and what it means for manufacturing is that recent apparent strength in the data may overstate the health of the factory sector. Looks Can Deceive After accounting for revisions, durable goods orders actually came in a bit better than expected. The September increase was 0.4% versus the 0.6% expected by consensus, but last month got revised from -0.2% to +0.2%, so the new level is higher (chart). On top of that, in this morning’s separately reported third quarter GDP report, we learned that headline growth got a half a percentage point boost from equipment spending, which shot up at a 10.8% annualized rate in the quarter. READ FULL ARTICLE>>