The Manufactured Goods Report for the month of May, released today, showed a continued downturn in the sector. The report, which includes data on both durable and nondurable goods, revealed a major negative revision to manufactured goods in the previous month.
New orders for durable goods increased slightly by 0.1% to $282.9 billion, following a 0.2% increase in April. This increase was primarily driven by transportation equipment, which saw an uptick for the third month in four. However, new orders for manufactured nondurable goods decreased by 1.0% to $300.2 billion.
Shipments of manufactured durable goods decreased by 0.4% to $284.6 billion, following three consecutive monthly increases. Transportation equipment led the decrease, with a drop of 0.9%. Shipments of manufactured nondurable goods also decreased by 1.0% to $300.2 billion, following a 0.5% increase in April.
Inventories of manufactured durable goods increased by 0.3% to $529.9 billion, following five of the last six months of growth. Transportation equipment led the increase, with a rise of 0.7%. Inventories of manufactured nondurable goods increased by 0.1% to $330.2 billion, following four consecutive months of growth. Petroleum and coal products led the increase, with a rise of 0.8%.
The Commerce Department revised durable goods orders for April from 0.7% to 0.2%, marking the second month with significant negative revisions. The full report on Manufactured Goods includes nondurable goods and total manufactured goods not available in the advance report.
The Services ISM report, released earlier today, was also a disaster. Based on the current report, the overall economy dipped into contraction. However, there was one positive wildcard that kept the GDPNow forecast from plunging more than it did, and further details on this will be discussed in the GDPNow report.
