January 2018 Manufacturing New Orders Improve

US Census says manufacturing new orders improved month-over-month. Our analysis shows the rolling averages declined.

Analyst Opinion of Census Manufacturing Sales

According to the seasonally adjusted data, there was significant strength in civilian aircraft. The data in this series is noisy so I would rely on the unadjusted 3 month rolling averages which declined.

Remember the headline numbers are not inflation adjusted.

US Census Headline:

  • The seasonally adjusted manufacturing new orders were up 0.1 % month-over-month.
  • Market expected (from Econoday) month-over-month growth of -3.0 % to 0.6 % (consensus -0.1 %).
  • Manufacturing unfilled orders were up 0.1 % month-over-month.

Econintersect Analysis:

  • Unadjusted manufacturing new orders growth accelerated 1.2 % month-over-month, and up 3.8 % year-over-year.
  • Unadjusted manufacturing new orders (but inflation adjusted) up 3.0 % year-over-year.
  • Three-month rolling new order rolling averages decelerated 1.4 % month-over-month and are up 3.4 % year-over-year.
  • Unadjusted manufacturing unfilled orders growth accelerated 0.3 % month-over-month, and up 4.1 % year-over-year
  • As a comparison to the inflation-adjusted new orders data, the manufacturing subindex of the Federal Reserves Industrial Production growth decelerated 0.4 % month-over-month, and up 1.2 % year-over-year.

Seasonally Adjusted Manufacturing Value of New Orders - All (red line, left axis), All except Defense (green line, left axis), All with Unfilled Orders (orange line, left axis), and all except transport (blue line, right axis)

The graph below shows sector growth year-over-year.

Year-over-Year Change Manufacturing New Orders - Unadjusted (blue line) and Inflation Adjusted (red line)

 

Now, look at the manufacturing component of industrial production. While it is true that these are slightly different pulse points (inventory not accounted in shipments) - they should not have different trends for long periods of time.

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