And finally, the US Census Bureau announced a 0.5% increase in September for new orders for manufactured durable goods. This was a surprise jump to the market as well, with forecasts only hoping for a 0.3% increase. This amounts to the phenomenal year-over-year increase of $1.5 billion. This brings the month’s total value of durable goods orders to $313.7 billion.
Transportation equipment was a major driver of this growth, adding $0.4 billion or 0.4% to grow to $110.7 billion. August was a robust 3% jump, revised up from an already solid initial 2.9% estimate. September’s numbers continue to underline the strength of our manufacturing sector.
Excluding transportation, new orders increased 0.6 percent. Excluding defense, new orders increased 0.1 percent. Transportation equipment, up for the second straight month, was the largest contributor to the advance, $0.4 billion or 0.4 percent to $110.7 billion, stated the US Census Bureau.
While transportation equipment was a major driver, the data shows other sectors were more broadbased with positive growth. Importantly, when transportation orders are stripped out, the jump is even larger at 0.6%. Even when we take out defense-related orders, the growth rate is positive at 0.1%.
Market analysts are watching the more macroeconomic impacts of these numbers. In reaction to the jobs report, the US Dollar Index climbed 0.1% to 99.88. This movement indicates an increasing confidence from the investment community about the future health of the manufacturing sector.
This jump in durable goods orders is a strong sign of manufacturing’s temporary strength right now. It provides incredibly important indicators of upcoming economic activity. Durable goods are typically seen as a leading indicator of economic performance, as they represent items expected to last three years or more.