New orders for durable goods, a widely monitored leading economic indicator, rose 4.0% in July on a seasonally adjusted basis, the U.S. Census Bureau reports. That’s the highest monthly gain since March, although the increase is somewhat tainted because a big chunk of the advance came from a surge in aircraft orders. Excluding transportation, durable goods orders rose by a milder 0.7%. Even so, the gain suggests that while the economy continues to struggle, the risk of an imminent recession remains a low-probability event.
Daily Archives: August 24, 2011
Is Business Spending At The Tipping Point?
“Business spending has been the recovery’s bright spot,” notes Kelly Evans in today’s Wall Street Journal. “Now, it too may be fading.” We’ll know for sure, one way or the other, later today, when the update on durable goods orders is released. Meantime, it’s premature to say this indicator has succumbed to the dark side. But the risk can’t be dismissed, given the recent weakness in the overall economy.