The global economy rebounded well in the first few months of the reopening, after the crash during the lock-down months. But, the rebound doesn’t seem so confident now, with economic reports showing weakness in major economies.

The US CB consumer confidence report showed an increased weakness in the confidence, but the durable goods orders for July were really great and revisions for June were positive as well. So, it’s uncertain now whether the rebound is continuing as strong as in the first two months, or if it is running out of steam.

US July 2020 Durable Goods Orders Report

• July prelim durable goods orders +11.2% vs +4.7% expected
• June prelim durable goods orders were 7.3% (revised to +7.6%)
• Core durables ex. transportation +2.4% vs +2.0% expected
• June core orders +3.6% (revised to +4.0%)
• Capital goods orders non-defense ex-air +1.9% vs +1.7% expected
• Prior capital goods orders non-defense ex-air +3.4% (revised to +4.3%)
• Capital goods shipments non-defense ex-air +2.4% vs +1.8% expected
• Prior capital goods shipments non-defense ex-air +3.3% (revised to +3.8%)

Defense aircraft parts were up 77.1% so that’s a big part of the beat and doesn’t reflect an economic pickup. However the revisions higher in core capital goods along with a solid headline number show a decent economic recovery; but this is much more in-line than the headline would indicate.