US total durable goods orders were unchanged on the month in November

US total orders for durable goods were unchanged on the month in November, coming in above the forecast (-1.0%) and consensus expectations (-0.6%). Non-defense aircraft orders did post the sharp decline as expected (-22% m/m, previous: +79%); however, this drag was offset by a surge in defense aircraft orders (47% m/m, previous: -14%) and a better-than-expected outturn for motor vehicle orders (1.5% m/m, previous: -2.9%). 

Excluding these volatile transportation goods, orders were down 0.1% m/m (previous: +0.5%), in line with the expectations. Orders for core capital goods were down 0.4% m/m, as demand for primary metals (-2.7% m/m, previous: 2.2%) and machinery (-1.5% m/m, previous: 0.7%) continues to struggle from the impact of the strong dollar. 

Core capital goods shipments fell 0.5 m/m and were revised lower to -1.0% m/m in October; however, shipments of non-defense aircraft, excluded from this aggregate, were up 16% m/m (previous: -4.2%). Elsewhere, manufacturers' inventories of durable goods fell 0.3% m/m. On balance, the November durable goods report is likely to be consistent with a manufacturing sector that continues to struggle.