Little sign of strength in March durables outside aircraft-related lift
|Summary
The 9.2% gain in March durable goods orders was due almost entirely to a pop in orders for nondefense aircraft. The underlying trend in orders remains weak as businesses await clarity on tariff policy. Durable shipments pulled back, but equipment spending was still strong in Q1.
‘Cause I’m leavin’ on a jet plane
Durable goods orders jumped 9.2% during March, but almost all of that gain can be traced to a surge in nondefense aircraft orders specifically, which jumped by $26 billion (a 139% monthly gain) (chart). When you strip out aircraft, the underlying trend in orders was more modest. Excluding broad transportation, orders were flat (chart). Core capital goods orders, which exclude aircraft and defense, rose just 0.1%.
The fastest gain other than in aircraft was orders for autos, which rose 2.3% during the month. That comes on top of a sizable 5.1% gain the month prior, and while that may partially reflect some pull-forward in demand ahead of tariffs, as we saw auto sales surge in March, it also comes off a weak autos trend in the back end of last year.
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