Durable Goods Orders ex Defense MoM

This indicator is the Excluding defense line of new orders in the Monthly Advance Report on Durable Goods Manufacturers' Shipments, Inventories and Orders. It shows the seasonally adjusted (adjusted for seasonal patterns) month-over-month percent change in current dollars (not adjusted for price changes).

The M3 survey (Manufacturers' Shipments, Inventories and Orders) has run monthly since 1957 across US manufacturing establishments. The survey covers domestic plants classified by 6-digit NAICS codes and targets firms with $500 million or more in annual shipments. It excludes nondurable goods, non-manufacturing activity and resales without further manufacture. It excludes semiconductors from orders and still includes civilian aircraft.

The Census Bureau releases the Advance Report about 18 working days after the reference month at 8:30 a.m. Eastern. The data cover the calendar month, and the Census schedule lists each month's advance date. The release shows shipments (net selling value at plant), unfilled orders (orders not yet shipped), inventories, ex-transportation and ex-defense lines and capital-goods splits.

Each Advance revises the prior month for late reports with concurrent factors (factors updated with current data), with older fixes in benchmark publications. The Full Report follows about 23 working days after the month at 10:00 a.m. Eastern. New orders signal future production commitments, and the publisher sets no buy-or-sell cutoff. The Bureau of Economic Analysis uses the data for GDP estimates, and policymakers use it for fiscal and monetary decisions.

Defense (Department of Defense prime work) is removed, so civilian transportation, machinery and electronics drive the series.

• Transportation equipment: motor vehicles and parts, civilian aircraft and parts, ships, boats and rail gear, the main swing source.
• Machinery: farm, construction, mining, industrial and other machinery.
• Computers and electronic products: computers, communications gear and instruments; orders exclude semiconductors by rule.
• Primary and fabricated metals: basic metal shapes plus downstream parts and structures.
• Electrical equipment, appliances and components: household appliances, electrical gear and related components.
• All other durable goods: furniture, medical equipment and supplies, plus miscellaneous durables.

In the October 2023 release, reported November 22, 2023, headline orders fell 5.4% to $279.4B while ex-defense orders fell 6.7%. That gap showed deeper civilian weakness. Excluding transportation, orders were virtually unchanged. Transportation equipment fell 14.8% to $92.1B, led by nondefense aircraft orders down 49.6%, while defense capital-goods orders rose 24.5%.

In the November 2023 release, reported December 22, 2023, headline orders rose 5.4% to $295.4B and ex-defense orders rose 6.5%. October headline orders were revised to $280.2B, down 5.1%, so single-month spikes need the ex-transport and core lines.

1. Collect reports: companies report shipments (net selling value at plant), new orders (binding-document orders net of cancellations) and end-of-month unfilled orders.

1. Estimate universe: scale shipments, unfilled orders and inventories by link-relative ratio (current values over prior values for firms present both months). Firms with extreme jumps are excluded from the ratio but kept in levels.

1. Derive new orders: new orders equal shipments plus the change in unfilled orders, including same-month fills and cancellations. For example, $100.0B in shipments plus a $5.0B backlog rise equals $105.0B in orders.

1. Adjust seasonally: apply Census X-13ARIMA-SEATS (Census seasonal adjustment program) with concurrent factors (factors updated with current data). Shipments also receive trading-day and holiday adjustment.

1. Compute percent change: apply the same steps to nondefense-scope values, then divide the monthly change by the prior level and multiply by 100. For example, $261.629B after $280.400B gives -6.7%.