Factory Orders Continue Decline in February

New factory orders for manufactured goods declined 0.4% or $1.4 billion in February to $363 billion on the heels of a 3.8% or $14.4 billion decrease in January. This is higher than the consensus estimate of a 0.2% decrease and is the sixth consecutive month-to-month decline. New orders for manufactured durable goods decreased $0.9 billion or 0.4% to $198.7 billion, revised from the previously announced 0.2% decrease.

The statistics for February 2001 are below.

New orders
New factory orders for manufactured goods declined 0.4% or $1.4 billion in February to $363 billion on the heels of a 3.8% or $14.4 billion decrease in January. This is higher than the consensus estimate of a 0.2% decrease and is the sixth consecutive month-to-month decline. New orders for manufactured durable goods decreased $0.9 billion or 0.4% to $198.7 billion, revised from the previously announced 0.2% decrease. Industrial machinery and equipment had the largest decrease, $1.3 billion or 3.1% to $42.2 billion. Fabricated metals, down five of the last six months, fell $0.7 billion or 3.7% to $18.9 billon. This is the largest decrease since May 1997. Transportation equipment decreased $0.5 billion or 1.3% to $41.7 billion. Electronic and other electrical equipment increased $1.9 billion or 5.0% to $38.9 billion, recovering nearly two-thirds of its fall in January. 
New orders for nondurable goods, down five of the last six months, decreased $0.5 billion or 0.3% to $164.3 billion. A decline in petroleum and coal products more than offset an increase in food products.

Shipments
Shipments of durable goods in February decreased $1.4 billion or 0.7% to $200.1 billion, revised from the previously published 0.3% decrease. This is the fifth consecutive decrease. Industrial machinery and equipment, led by computer and office equipment, had the largest decline, $2.0 billion or 4.7% to $41.4 billion. This is the largest decrease since July 1986 and the seventh in the last ten months. Electronic and other electrical equipment decreased $0.3 billon or 0.7% to $40.0 billion. Fabricated metals, down six consecutive months, decreased $0.2 billion or 1.3% to $19.1 billion. Transportation equipment, up for the first time since September, increased $1.4 billion or 3.5% to $42.4 billion, due to aircraft and parts.
Shipments of nondurable goods, down five of the last six months, decreased $0.5 billion or 0.3% to $164.4 billion. Petroleum and coal products had the largest decrease, $0.9 billion or 4.2% to $19.7 billion..

Unfilled Orders
Unfilled orders for durable goods in February decreased $1.4 billion or 0.2% to $568.6 billion, revised from the previously published 0.3% decrease. Electronic and other electrical equipment, down three consecutive months, had the largest decrease, $1.1 billion or 1.2% to $94.4 billion, due to electronic components. Primary metals, down 15 or the last 16 months, decreased $0.3 billion or 1.1% to $28.9 billion. Transportation equipment decreased $0.8 billion or 0.3% to $262.8 billion. Industrial equipment and machinery increased $0.8 billion or 0.9% to $92.7 billion, due to engines and turbines.

Inventories
Inventories of durable goods decreased $0.2 billion or 0.1% in February to $312.0 billion. This is the first decrease since March 2000. Transportation equipment had the largest decrease, $0.4 billion or 0.6% to $68.6 billion. Electronic and other electrical equipment increased $0.2 billion or 0.5% to $49.5 billion, the tenth increase in the last eleven months. 
Inventories of nondurable goods decreased $0.5 billion or 0.3% to $182.96 billion, primarily due to chemicals and allied products. 
By stage of fabrication, February finished goods increased 0.2% in durables and decreased 0.1% in nondurables. Work in process decreased 0.1% in durables and 0.6% in nondurables. Materials and supplies decreased 0.2% in durables and 0.4% in nondurables.

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