After reporting two consecutive monthly decreases in orders for manufactured goods, the Commerce Department released a report on Thursday showing a modest increase in orders in July, although the increase fell short of economist estimates.
The report showed that orders for manufactured goods edged up by 0.1 percent in July following a revised 0.6 percent decrease in June. Factory orders had been expected to increase by 0.3 percent compared to the 1.2 percent drop that had been reported for the previous month.
The modest increase in factory orders in July was largely due to a 12.9 percent increase in orders for transportation equipment, which reflected a substantial 75.9 percent increase in orders for commercial aircraft and parts.
Excluding the increase in orders for transportation equipment, factory orders actually fell by 1.5 percent in July compared to a 0.6 percent drop in June.
The report also showed that orders for durable goods increased by 0.4 percent in July, which reflects an upward revision from the 0.3 percent increase that was reported last week. However, the increase in durable goods orders was primarily due to the increase in orders for transportation equipment.
Meanwhile, orders for non-durable goods were nearly unchanged, falling by less than 0.1 percent in July following a 1.1 percent drop in June.
The Commerce Department also said that shipments of manufactured goods rose by 1.1 percent in July after falling by 0.5 percent in June. Shipments of durable goods surged up by 2.3 percent, while shipments of non-durable goods edged down by less than 0.1 percent.
Inventories of manufactured goods increased by 1.0 percent in July after inching up by 0.1 percent in the previous month. The increase reflected a 0.6 percent increase inventories of durable goods as well as a 1.6 percent increase inventories of non-durable goods.
With inventories and shipments increasing at roughly the same rate, the inventories-to-shipments ratio came in unchanged at 1.26.
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