Consumer Confidence and New Home Sales Jump in the US
Today's US data is showing resilience in the economy as consumers feel better on falling inflation
The US economy has been showing mixed signals in recent months, with certain indicators heading into contraction while others have been showing resilience, hence the FED decided to pause rate hikes in June, but they are contemplating further hikes ahead. Today the Conference Board released its CB Consumer Confidence report, which indicates an improvement in consumer confidence this month. The index rose from 102.3 points in May to 109.7 in June, surpassing analyst expectations of 104 points.
The Expectations Index, which reflects consumers’ short-term outlook on income, business, and labor market conditions, also saw an increase from 71.5 to 79.3. It is worth noting that values below 80 are typically associated with recessionary conditions.
US Advance Durable Goods Orders for May 2023
- Prior month +1.1% revised to 1.2%
- Durable goods orders 1.7% versus expectations of -1.0%. Prior month +1.1% revised to 1.2%. This marks an increase for three consecutive months, following a 1.2 percent increase in April.
- Transportation equipment orders led the increase, going up $3.9 billion or 3.9 percent to $102.6 billion.
- Ex Transportation 0.6% versus expectations of -0.1%. Prior month -0.2% revised to -0.6%
- Ex Defense 3.0% versus the prior month of -0.6% revised to -0.5%.
- Non-defense Cap Ex-air 0.7% vs expectations of 0.0%. Prior month +1.4% revised to 0.6%
Further details of shipments, unfilled orders, and inventories show:
Shipments:
- Shipments of manufactured durable goods in May increased $4.8 billion or 1.7 percent to $282.7 billion.
- This marks an increase in two of the last three months, following a 0.6 percent decrease in April.
- Transportation equipment shipments led the increase, going up $4.0 billion or 4.6 percent to $91.8 billion.
Unfilled Orders:
- Unfilled orders for manufactured durable goods in May increased $10.6 billion or 0.8 percent to $1,302.0 billion.
- This marked an increase for five of the last six months, following a 0.8 percent increase in April.
- Transportation equipment orders led this increase, going up $10.8 billion or 1.4 percent to $803.9 billion.
Inventories:
- Inventories of manufactured durable goods in May increased $1.2 billion or 0.2 percent to $522.9 billion.
- This marks an increase for five of the last six months, following a 1.0 percent increase in April.
- Machinery led this increase, with a rise of $0.5 billion or 0.5 percent to $94.4 billion.
A look at Capital goods shows:
Capital Goods:
- Nondefense new orders for capital goods in May increased $5.7 billion or 6.7 percent to $91.0 billion.
- Shipments increased $2.7 billion or 3.4 percent to $82.9 billion.
- Unfilled orders increased $8.1 billion or 1.1 percent to $748.7 billion.
- Inventories increased $0.1 billion or 0.1 percent to $225.5 billion.
- Defense new orders for capital goods in May decreased $2.7 billion or 14.7 percent to $15.9 billion.
- Shipments decreased $0.2 billion or 1.2 percent to $13.2 billion.
- Unfilled orders increased $2.7 billion or 1.3 percent to $213.6 billion.
- Inventories increased $0.1 billion or 0.2 percent to $24.2 billion.
Overall better than expected orders data. Shipments increased as well, as did unfilled orders. Transportation led the gains. With air traffic increasing post-pandemic, the suppressed orders from those years are being backfilled.
The durable goods report will be revised when factory orders are released in a week or so.
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