Aircraft Orders Pull Factory Demand Lower, While Shipments Continue to Advance

New orders for manufactured goods decreased 1.3% in May after increasing 5.3% in April. Meanwhile, new orders for manufactured goods rose 5.1% over the year. When excluding transportation, new orders stepped up 1.9% over the month and 5.5% year-over-year in May. Orders for durable goods fell 4.5%, following an 8.5% jump in April. Year to date, durable goods orders advanced 6.3%. Meanwhile, nondurable goods orders increased 2.2% after moving up 1.9% in April. At the same time, nondurable goods orders grew 4.0% over the year.

In May, the largest monthly decline occurred in nondefense aircraft and parts, which plummeted 51.8% after surging 167.4% in April. On the other hand, the largest gain occurred in mining, oil field and gas machinery, which rose 10.2% after jumping 30.2% the prior month. The largest over-the-year changes occurred in mining, oil field and gas machinery (up 41.8%) and nondefense aircraft and parts (down 22.4%).

Factory shipments rose 1.6% in May, after increasing 1.3% in April. Shipments grew 5.8% over the year. Shipments excluding transportation stepped up 1.6% in May, following a 1.4% rise the previous month. Shipments for durable goods moved up 1.0% in May, following a 0.7% uptick in April, and are up 7.6% year to date. Meanwhile, nondurable goods shipments increased 2.2%, after advancing 1.9% the prior month, and are up 4.0% year to date.

Unfilled orders for all manufacturing industries moved up 0.6% in May after rising 1.8% in April. Unfilled orders over the year jumped 8.7%. Inventories increased 0.2% month-over-month and 2.0% year-over-year. The inventories-to-shipments ratio edged down from 1.49 in April to 1.47 in May. The unfilled orders-to-shipments ratio for durable goods moved down from 6.95 in April to 6.91 in May.